Choose a costing method

Standard Cost

Fixed unit cost, updated manually as vendor contracts change.

Average Cost (AVCO)

Weighted average recalculated on each incoming receipt.

FIFO (First In, First Out)

Each receipt retains its distinct unit cost layer, and sales consume the oldest layer first.

The Inventory app keeps track of the inventory value in real time as you receive and deliver goods. The reporting menu lets you analyze inventory quantities and values by company, location, product, and more.

The Accounting app updates accounts when you receive invoices or bills. Even though receipts and invoices differ, accountants post closing entries to reconcile the difference between what has been invoiced and received/delivered.

There are two accounting practices on how to maintain your accounts, defined in Accounting app › Configuration › Settings, under the Inventory Valuation section:

• Periodic: Post vendor bills as expenses by nature, and update stock valuation in the closing entry by reducing expenses (stock variation). This is the best practice in Europe.
• Perpetual: Post vendor bills as assets (stock valuation), and recognize cost of goods sold when goods are delivered/invoiced. This is the best practice in Anglo-Saxon accounting (US, UK, GCC).

Before WindoorERP 19, the Perpetual accounting method posted real-time accounting journal items at every single warehouse movement, which caused high transaction overhead and cluttered general ledgers.

Since WindoorERP 19, the Perpetual method impacts stock valuation cleanly at the invoice level, and the closing reconciliation wizard handles interim gaps (bills to receive, invoices to issue, prepaid expenses, and deferred revenues).