Moving Average Cost for Parts Inventory
Choose between today's mixed costs and moving average cost for issues, job and quote costs, margins and stock valuation.
Included with your module subscription at no extra charge. An administrator switches each pack on for your business in Admin > Features.
What parts costing method is
A parts catalogue can end up with several ideas of what a part cost: the last purchase price, a standard cost keyed years ago, whatever a screen happened to read. Parts costing method gives the business one choice to make. Stay on Legacy, where each screen keeps the cost it uses today, or switch to Moving average.
On Moving average, a part is valued at its average cost from receipts, falling back to the standard cost only when it has no receipts. That average then drives stock issue costs, stocktake and adjustment costs, work order and quote part costs, part margin, branch stock values, the slow-moving report and the reconciliation. A part received at no cost, such as a warranty replacement, joins at the current average and does not drag it down.
Switching is a controlled act. Admins, dealer principals and finance managers preview it first, seeing stock value on both bases and the parts where they differ, then confirm separately. Each switch is logged. Because the ledger already carries stock at that cost, the switch posts no journal. Price matrix bands and the stocktake and adjustment approval thresholds stay on the standard cost unless the business turns on an option for each. The finance card is in Finance > General Ledger > Overview.
The choice affects reports as well as screens. While a business is on Moving average, reconciliation shows stock on both bases, so finance can see the difference rather than take it on trust, and direct writes to the average and last cost fields are refused. Stock-take and adjustment entries made before the switch stay at the cost they were posted at, so any drift remains visible instead of being quietly rewritten.
Part of these modules
What parts costing method covers
- Keeps a business on Legacy costs, or switches it to Moving average
- Drives stock issue costs, stocktake and adjustment costs, work order and quote part costs, part margin and branch stock values from the average
- Joins stock received at no cost at the current average without lowering it
- Previews the switch with stock value on both bases and lists the parts that differ
- Logs each switch, and shows reconciliation on both bases while Moving average is on
Where parts costing method stops
Stated as it behaves today, so you can judge the fit before you switch it on.
- Does not change receipts, equipment unit costs, purchase prices, the standard cost price or documents already issued
- Has no last-cost or FIFO method; average only
- Keeps price matrix bands and approval thresholds on the standard cost unless an option is turned on for each
- Posts no journal when the switch is made
Parts costing method in a working day
The finance manager notices margin on a common seal looks healthy on quotes and thin on invoices, because the two screens read different costs. She opens the Overview card, previews the switch, and sees the two valuations side by side with the differing parts listed. She confirms, and the same average now sits behind the quote, the job and the stock report.
Switching on parts costing method
Included with your module subscription at no extra charge. An administrator switches each pack on for your business in Admin > Features.
Ask MDMS AI about parts costing method
Try asking Read
“How are parts costed?”
Admin, dealer principal, finance, parts manager and branch manager. Reads only. MDMS AI is an optional add-on with its own price and an AI seat, and what it can answer depends on your modules and role.
About MDMS AIMore feature packs
Back-order allocation
Holds stock that arrives for the oldest waiting work orders and sales orders at the same branch, with every hold on a ledger.
Seasonal reorder adjustment
Enter twelve monthly factors per branch and demand suggestions adjust for busy and quiet months, within limits you control.
Delivery dockets and proof of delivery
Create a delivery docket from picked sales order quantities, and have the driver capture a signature and photos on the phone.
Frequently asked questions
- Does switching change my past documents?
- No. Documents already issued are untouched, as are purchase prices, equipment unit costs and the standard cost price.
- Can I use FIFO or last cost?
- No. The choice is Legacy or Moving average.
- Who can switch it?
- Admins, dealer principals and finance managers can preview and confirm the switch.
Where this work shows up
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