Cost & gross profit
KURAPRO automatically calculates asset value and gross profit. You choose that calculation method as the costing method, per company.
The three costing methods
| Method | How cost is determined | When to use |
|---|---|---|
| Moving-average costing | Automatically calculates the average cost from inbound purchase prices | You want to manage products with fluctuating purchase prices at a cost close to reality |
| Standard costing | Uses a fixed standard cost set per product | You want to see gross profit simply, at a predetermined cost |
| No costing | Manages only quantity, without amounts or gross profit | You don't need cost management and only need to track stock counts |
How to set it (admin)
- Open "More."
- Choose "Costing method."
- Choose from "Moving-average costing," "Standard costing," or "No costing."
The chosen method is reflected in the calculation of asset value and the gross profit in reports.
How each one works
Moving-average costing
- When you enter a purchase unit price in an inbound task, that product's average cost is automatically calculated and updated.
- The gross profit of an outbound is recorded at the average cost at the time the outbound was completed (a snapshot).
- Therefore, even if the purchase price or cost changes later, past gross profit does not change.
Standard costing
- Set a standard cost per product (entered on the edit screen in Managing products).
- The gross profit of an outbound is calculated using that product's standard cost.
- Changing a product's standard cost also recalculates the gross profit in past reports.
No costing
- Amounts and gross profit are not tallied. You manage only the quantity of stock.
- The unit price input fields for inbound/outbound are not shown either.
Calculating gross profit
Gross profit is calculated for outbound tasks as follows.
Gross profit = outbound amount (sale unit price × quantity) − total cost of the stock sent out
- The cost follows the selected costing method (average cost / standard cost).
- The inbound unit price itself is not directly reflected in gross profit. In moving-average costing, the inbound purchase unit price is used to update the average cost.
- For how to read the tallies in detail, see Reports.
FAQ
Q. The gross profit number looks wrong / different from what I expected A. How it is determined differs by costing method. Moving-average costing is fixed at the average cost when the outbound was completed, so changing the purchase price later does not change past gross profit. Standard costing uses the product's standard cost, so changing the standard cost also recalculates past gross profit.
Q. The unit price input field doesn't appear A. The costing method is set to "No costing." To manage amounts and gross profit, change it to moving-average or standard costing.
Q. Where do I enter purchase price / sale price? A. Not on the product. Enter them in each task: inbound = purchase unit price, outbound = sale unit price.
Related pages
- Managing products (setting standard cost)
- Tasks (inbound, outbound, adjustment, stocktaking) (purchase/sale unit price)
- Reports (gross profit tallies)