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Have just upgraded to Account right live. When we invoice one item, the relevant cost of sale is consistenly under valued. How do we correct this? It was the same problem before we upgraded.
Hello @BPollard ,
MYOB follows Average costing method, whereby COGS of an item is determinted by:
Current Value / Qty on hand
(as seen in the screenshot below, the average cost is $346.326 (total value: $1731.63 / 5 qty = cost $346.326)
We recommend that you talk to your accountant about perhaps recording an inventory adjustment to bring up the total value of this item, thereby increasing the average cost.
I would also recommend looking at the item history, by clicking into the blue arrow next to Current Value, in an attempt to determine whether a cost discrepancy can be found in any past transactions.
Furthermore, also be mindful that this average cost & total value is usually a GST exclusive amount. and hence the COGS realised on the sales invoice is also a GST exclusive amount.
Hi Alik607, thanks for your response.
Unfortunately not solved, however it was helpful. I did find some errors in builds from looking at the item history.
I adjusted my stock to get the correct cost based on current value/current stock. See screen shot 1
I then entered a sales but the resulting COGs does not take the average cost. See screen shots 2 & 3
COGS calculation is still wrong and does not appear to be based on the average cost
Apologies for the delay in response.
In AccountRight, when an item is sold, the asset account for the item is reduced thereby increasing the cost of sales account, and is determined based on average costing method, as explained by @AliK607. The resulting amount for cost of sales is shown exclusive of GST in the Items Register window.
Therefore, it is $2140.52 for your item when 1000 units were sold. However, in order to clarify if that value is correct, please open the sales transaction, recap it by pressing Ctrl +R and attach screenshots for both the sale and recap window, so we can investigate it further.
I've attached screen shots for the sales journal and recap. I have also included screenshots from the Inventory register which shows the average cost as $30 but cogs of about $12. Look forward to hearing from you.
The cost of sale values do look incorrect, provided the tax code is N-T and average cost is approximately $30. However, if your file is online, please send me your serial number by a Private Message so I can run an online inventory script which resolves the issue at times.
see file attached, problem persists