...
[Value of Stock at the start of the period] + [Value of Receipts] + [Value of Stock Value Adjustments] + [Value of Initial Stock Adjustments] + [Value of Inwards Transfers]
divided by
[Quantity of Stock at the start of the period] + [Quantity of Receipts] + [Quantity of Initial Stock Adjustments] + [Quantity of Inwards Transfers]
where:
[Value of Stock at the start of the period] - as recorded in the stock closeout for the previous period, being Average Cost * Quantity of SOH
...
[Value of Stock Value Adjustments] - these are value adjustments only, where the quantity is zero. Adjustments which have a non-zero quantity (e.g. stocktake adjustments) are not included. Value adjustments can be used to include landed costs in stock Unit Cost Rates.
[Value of Initial Stock Adjustments] - these are stock adjustments in the first period where stock is recorded in a particular item/location. This enables the initial average cost of a new item/location to be established by means of a stock adjustment, as normally stock adjustments with non-zero quantities do not affect the average cost.
[Value of Inwards Transfers] - the value of transfers where stock has been transferred into a stock location. Note that the Unit Cost Rate used in stock transfers comes from the location the stock is being transferred out of.
[Quantity of Stock at the start of the period] - as recorded in stock closeout for the previous period.
[Quantity of Receipts] - the quantity recorded on Inwards Goods Lines for stock purchases
[Quantity of Initial Stock Adjustments] - these are quantities on stock adjustments in the first period where stock is recorded in a particular item/location. This enables the initial average cost of a new item/location to be established by means of a stock adjustment, as normally stock adjustments with non-zero quantities do not affect the average cost.
[Quantity of Inwards Transfers] - the quantity of transfers where stock has been transferred into a stock location.