Inventory Costing Recalculations

NetSuite uses inventory costing recalculations to adjust costs. The adjustment corrects inventory costing values when transactions get added to or removed from an existing series of transactions.

When you enter a series of purchases, sales or adjustments for a particular item over time, you have a specific costing history for that item. The inventory costing values need to be recalculated each time there is a change to the costing history of a particular item.

For example, you receive an order of widgets into inventory. The cost of each widget in that shipment affects the costs that show when you sell widgets after the receipt date. You might encounter this scenario:

NetSuite calculates the average cost of the widgets from the receipt date forward. If you insert a sales transaction dated before the March receipt, the item on that transaction uses the $10 average cost. Any sales entered with a date after the March receipt uses the $12 average cost.

Item records can show the status of cost accounting calculations. For more information, see Cost Accounting Status on Item Records.

Related Topics

General Notices