TABLE OF CONTENTS
Material COGS
COGS ($) — material's cost of sales.
The value of COGS depends on the inventory costing method we use. In FCX, we use the Average Cost method to record the level of inventory a company sold during a period.
The material's cost of good sold is calculated by the Weight-Average formula.
To calculate Material COGS, the system searches for Inventory Transaction Entries (ITE) of PUSH type that related to the Purchase Inventory Transaction for the year → then calculates the COGS as follows:
It recalculates the material COGS with each new Push ITEs in the system.
Example
How Tax and Delivery allocated in Material COGS
The Price of material in an Inventory Transaction Entry may include Tax and Delivery amounts. It depends on whether you defined Taxes and Delivery fees in the related Inventory Transaction Journal.
Put zero amounts in the event you do not add any cost for Tax and/or Delivery in the ITJ. Thus, The Price for material in ITE will not contain the percentage of tax/delivery (will be 0).
In turn, if you add a cost of Tax and/or Delivery in the ITJ the Material COGS will adjust accordingly.
You can enter Taxes and Delivery in the ITJ according to estimated percentages or add more accurate cost. The next part describes how we allocate these costs to the material price in the Inventory Transaction Entry.
Change Material Price in ITJ
If you want to change the material price for executed or completed ITJ, use the corresponding option "Change Price".
Select a line (material) in the ITJ and click to change the price. Once you enter a new price, the system will recalculate the price in the related Inventory Transaction Entry and thereof the COGS in the Material card.
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