What is average cost?

Setup

• Retail POS for Mac or PC

Answer

Every product in Retail POS has an average cost. The average cost can be a different value to a product's supply price and is a different entity in Retail POS.

Average cost is:

• A weighted average of the supply prices that the current units of stock on hand were received at.
• Affected only through the use of a stock order in Retail POS. Directly editing a product's supply price on the Edit product page will not make a change to the average cost.
• How your cost of goods (and therefore the cost of goods sold (COGS)) is calculated, not by a products' supply price.
• The Stock Value figure used for Retail POS reporting functions to calculate COGS, Gross Profit, etc.
• Updated by the system only when a change in inventory levels occurs (i.e. Sales/Stock orders/Purchase Orders).

Additional Information

• Editing the average cost of products
• Accurately Calculating Cost of Goods ("COGS") Sold in Retail POS