Calculating Cost Of Material I have problem with calculation of the material cost. I have been calculating material cost using standard method (Beginning Inventory - Ending Inventory + Purchases = Material Cost) I am valuing products at different unit costs because value is being added at each stage (i.e. Raw $1, WIP $2, FG $3). So in this case, if there are more products in FG stage, I would end with higher ending inventory, which would give me lower material cost. To better understand this, I have attached a spreadsheet. Please take a look at it. I am willing to change method or way how inventory is being valued. I appreciate all your inputs and methods. Your Thoughts? |
