Hi All, Quick question what is the recommended costing method when using serialized inventory? We are currently using average costing but we are seeing errors in the calculation of the average cost that doe snot make sense. After our costing engine runs the averages cost increases instead of decreasing when receiving lower value inventory for the same item. Our sales department is worried that the margins are off for sals commissions.

FWIW most everyone I've seen uses specific costing for serialized inventory, as it's more granular/intuitive when you're already tracking at the individual unit level. I guess I could see using average though if that's directly plugging into commissions, as you could potentially see big transaction to transaction swings depending upon the purchasing situation. Not sure if this is your issue, but my only real suggestion on the costing issues is to look really carefully at the transaction ordering and make sure everything is correct there, especially intra-day transactions. This was a big pain point at a couple places I saw and required regular monitoring/resolution.

I think I tested this a while back and even when you set a Serialized Inventory Item to be Average Costed, it still uses Specific Costing? I could be wrong here, been a few years.

Our items are set to Specific at the item record but the Cost accounting is set to Average. i think there may be a bug on how the costing engine is calculating the average.