complicated issue. And we do not know how to deal with it in MANAGER example: I bought a quantity of 10 items of different quality from the merchant for a value of 1000$ I sold 5 pieces worth 1000$ of the best quality I have 5 pieces left in stock with a market value of 100$ ( during the quality…

Manager only uses weighted average for inventory valuations. The justification behind this choice is described in detail in this post: [image] Can you add FIFO mothed insteed on inventory average cost Currently it’s perpetual weighted average method. Mostly because it ha…

Manager only uses weighted average for inventory valuations. The justification behind this choice is described in detail in this how can I deal with the inventory value cost and profit to match the books ? any solution?

I’m not sure what you mean by your question. All inventory valuation methods other than Specific Identification are estimates based on some underlying assumptions. If you say that you want to match your cost to something else, this implies that you know the true cost. In this case, you don’t really…

[image] Ealfardan: I’m not sure what you mean by your question. All inventory valuation methods other than Specific Identification are estimates based on some underlying assumptions. If you say that you want to match your cost to something else, this implies that you know the true cost. In this…

[image] maldroubi: inventory value cost and profit I would advise to create a test business, to get a clearer picture. You create a test inventory item. You create a payment to purchase 10 items at $100 for a total of $1,000 When you view the inventory tab it shows that you have 10 items at…

[image] maldroubi: true cost its the market value The market value is impossible to be automatically calculated within an accounting software. And although it has some applications in decision making, market value costing (formally known as replacement costing) isn’t allowed in financial acc…

[image] maldroubi: The MANAGER calculating is different from the reality because it calculates the average cost of the commodity. Manager’s calculated average cost is definitely not different from reality. It is reality, because it represents the average cost of the units you told it were all…

[image] Tut: Whether this matters depends on your turnover rate. If everything sells within a financial period, you will notice nothing. But if sales are stretched across more than one period, you will notice higher and lower profits. Still, the combined profit will be the same over the long ter…

[image] maldroubi: the actual average cost of the remain items its can’t be traced for the auditor. Yes they can. Any auditor will understand average cost inventory accounting. Because Manager is a perpetual system, the cost information is carried forward from year to year. [image] maldro…

Profit inflation and high average cost

Ealfardan April 23, 2023, 1:02pm 2

Manager only uses weighted average for inventory valuations. The justification behind this choice is described in detail in this post:

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What inventory system is adopted by Manager?	4	1396	April 25, 2017
Item avarage cost vs. Inventory profit margin	8	553	December 13, 2018
Average Inventory Cost effect on profit	9	813	October 14, 2019
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Inventory - Landed Cost	29	8662	May 19, 2016

Profit inflation and high average cost

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