The problem arises when the stock or a part of it has already been sold out, exhausted over, written off and so one and so forth, and then you are invoiced for shipping (storage, packing and etc). It would be reasonable to revalue our stock and later when selling (writing off and so one) spends at new cost price. Accordingly, this new price is supposed to be recorded in the sales statistics for gross profit calculations based on the selling process of these stock items, isn't it? However, we received the invoice on these "late" costs when the stock had already "gone" from the warehouse. Does anything like this happen in your practice? What is a percentage ratio of such costs to an initial stock price?

If your company keeps a detailed management accounting, you have to split up these amounts proportionally to:

• Stocks that are held in the warehouse
• Stocks that are sold to the customer A
• Stocks that are sold to the customer B
• Stocks that are written off as wasted
• Stocks that are written off as a stock taking difference
• Stocks that are moved to another warehouse.

Are you aware of this problem now? Certainly, there are software packages (one of which is Scala program and I'm doing consulting for this software users), which supports your operations. Nevertheless, all of them are doing just certain kind of approximation to reality, unless it is a program with built-in artificial intellect.

The matter is what simplification and/or assumptions we can make here. That is exactly what I would like to ask you: "what kind of simplification and what is affordable for you?" You might reply this way: "No simplification are possible". Actually it depends on how significant it is for you. Do you remember "80/20" rule? Let's discuss it.

In the section Scenario I'm giving a detailed description of possible algorithms of the movement of stock from the moment of purchasing and on, and a few ways of account simplification in comparison with an ideal one.