日本語 English 中文

MRP glossary TOP > Inventory Control > Simple Average Method

Simple Average Method

It is a method for inventory valuation or delivery cost calculation, where even if accepting inventory goods with different unit cost, the average unit cost is calculated by multiplying the total of these unit costs simply by the number of receiving. The example of Simple Average Method is as follows. In this case, the total of unit costs received for the period from 1st to 24th is 900 yen, and the time of receiving is four, which means average receiving unit cost is 225 yen. The inventory valuation (9,000 yen) is obtained by multiplying the average unit cost (225 yen) by the balance (40).

mrp_139.jpg
Related term: Average Cost Method

Reference:JIT Business Research Mr. Hirano Hiroyuki

Service Ratio | Inventory Control | Simultaneous Stocktaking