moving average price

[Former Member]

Hello Gurus,

Can any one let me know how system calculates moving average price? is there any situation where system calcultes moving avg price though the standard price is enabled? I will be very happy if any one provides me mathematical formula for calculating moving avg price.

thank you

Srinivas

[Former Member]

Hi Srinivas,

Moving Average Price (MAP) is not calculated through Standard price; in material master we can maintain price control as standard price (S) or moving average price (V).

MAP is calculated as shown below;

Material purchased on 01jan09 - Rs. 100 @ 50 pic

In material master it updates as 100 in MPV, 50 in total stock and 5000 in total value.

When same material is purchased on 10Jan09 u2013 Rs. 80 @ 50 pic, now system updates as follows.

100*50 = 5000

80*50 = 4000

Total value = 9000

Total quantity = 100

MAP = Total Value / Total quantity

MAP updated in material master is 90

Regards,

Giridhar

[Former Member]

Hello Giridhar,

Thank you very much for your answer. my doubt is, will system consider moving average price in any situation or condition though the standard price control 'S' is enabled in material master.

and another doubt when there is second lot of material with lower price, system will recalculate moving average price (i.e 90), will this have any impact on anything like inventory revaluation? are there any movement types which are linked with this? please let me know..

Thank you,

Srinivas