Costing Metho: Nav 2018/ Business Central
The costing method determines if an actual or a budgeted value is capitalized and used in the cost calculation. Together with the posting date and sequence, the costing method also influences how the cost flow is recorded. The following methods are supported in Microsoft Dynamics NAV: Costing method Description When to use FIFO An item’s unit cost is the actual value of any receipt of the item, selected by the FIFO rule. In inventory valuation, it is assumed that the first items placed in inventory are sold first. In business environments where product cost is stable. (When prices are rising, the balance sheet shows greater value. This means that tax liabilities increase, but credit scores and the ability to borrow cash improve.) For items with a limited shelf life, because the oldest goods need to be sold before they pass their sell-by date. LIFO An item’s unit cost is the actual value of any receipt of the item, selected by the LIFO rule. In inventory val...