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Stock Item cost

  • September 30, 2026
  • 3 replies
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Hi, Hope you can help me understand this.

Scenario: We sell stock items to Company A (an intercompany customer) using the Sales Order → Shipment → Invoice process instead of a transfer. Normally, these invoices show no cost, so nothing posts to COGS.

Now, one invoice suddenly shows a cost when released, even though:

  • The item was already receipted from the vendor earlier (and the receipt has a cost in the inventory transaction history).
  • Previous intercompany sales of the same item still had zero cost.

What I want to understand is Why did the cost stay at 0 before, and why does it suddenly appear now, when the vendor receipt cost was already there the whole time?

Item’s valuation is Average.

Best answer by MarkD

Found it! It’s based on my PO. It was initially bought for, say $25, for a quantity of 1 then it was sold with the same cost leaving the ending quantity to 0. Then it was receipted in production via Move transaction with no cost captured and then sold to customer with 0 cost captured since we receipted 0 cost in production. Then an RMA was done and the cost was manually entered. then it was sold again after returning and the system averaged it.

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3 replies

Eric Ratté
Jr Varsity I
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Hi, one cause may be the valuation method defined for the item. If it’s Standard cost, a user define the cost of the item regardless of the actual cost of the receipt.

 

If the standard cost was zero and then, changed to something else, then the next transaction will contain the new cost.

 

You can verify the valuation method at the first tab of the stock item profile.

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rkenna
Captain II
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  • Captain II
  • September 30, 2026

Hi ​@Eric Ratté, it seems the Valuation is Average based on the message above.

​@MarkD, the Receipt having the cost is where it is coming from. Did you look at your PO and see the cost on the PO? That should be the place to look.

 

Cheers,

RJ

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  • Author
  • Semi-Pro I
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  • October 2, 2026

Found it! It’s based on my PO. It was initially bought for, say $25, for a quantity of 1 then it was sold with the same cost leaving the ending quantity to 0. Then it was receipted in production via Move transaction with no cost captured and then sold to customer with 0 cost captured since we receipted 0 cost in production. Then an RMA was done and the cost was manually entered. then it was sold again after returning and the system averaged it.

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