Average Receipt Price
Use
The procedure for calculating the average receipt price is basically used to provide an objective and traceable price as a basis for
Lowest Value Determination.
Prerequisites
Before you have the system calculate the average receipt price, you must prepare the receipt data to be analyzed. The procedure uses the same receipt data that is also analyzed in LIFO and FIFO valuation. The preparations basically include the same steps that are required for FIFO valuation. These are:
Determining the Valuation Level
Selecting the Relevant Movements
Selecting the Relevant Materials
Adopting Data Posted in a Posting Period
Features
The average receipt prices can be updated as physical inventory prices or material valuation prices. Their exact purpose depends on the installation.
See also:
Calculating the Average Receipt Price