FIFO or First in First Out is the item that first enters is the item that first comes out. For example, if you sell food, what you sold first is food that first enters to the store. it's Not allowed to sell food that last entered. if you do that, then the food that enters at the beginning will be damaged or cannot be resold for a long time.
Table of Content :
II. How to Use
I. How To Configuration
Step 1. Click Setup - More Menu - Configuration Module
Step 2. Later on the "Buy" sub menu - enable FIFO in the COGS field
II. How to Use
Step 1. Make 3 different Purchases with 3 Different Costs
Make several purchases with different cost / COGS, for example you made purchase a product by the name "book" 3 times with 3 different costs for each purchase.
Step 2. On the Product Menu - click inventory cost - then you will be able to check the stock of each product purchase with a different cost
Step 3. Display Stock and cost that will be used when selling from each Quantity
Step 4. At the time of sale the Cost used is the Cost of the initial stock of the purchase made
Some case in FIFO can not handled :
When you enable this feature you will not be able to perform a Sales Return.
If a product that has FIFO stock has been sold, no Void purchase order can be done.
Doing Quantity edits on existing sales will not affect the stock FIFO.
Selling that has a quantity of more than FIFO stock will not affect FIFO stock.
If there are 2 outlets that have a FIFO stock, then there is a sale at one outlet whose quantity is more than the FIFO stock at outlet 1 then the remaining sales will reduce the FIFO stock at outlet 2.
You might also like to read this article :
Sometimes the purchase transactions made have several rejected or damaged products, so these products need to be returned to the supplier. To return a Serialized type product, you can check this article for the detailed steps : Purchase Return of Serial Number Product
Obviously, the purchase price might change at any time during the process of purchasing products; however, we give multiple methods for calculating the product COST, the details of which can be found in the following article : Setting Up Product's COGS Calculation
If you want to make 2 steps for buying process (proposed - approve), you can read the article here : How to Activate Approval when using Buy (2 Steps)