ERPNext Stock
What is Moving Average Valuation in ERPNext?
- Moving Average Valuation in ERPNext
- Moving Average is a stock valuation method in ERPNext that recalculates the average item cost with every new stock receipt.
How Moving Average Works
Each time new stock is received at a different price, ERPNext recalculates the weighted average cost. This new average becomes the valuation rate for future consumption.
vs FIFO
Moving Average smooths out price fluctuations and is simpler for reporting. FIFO is more accurate for perishables and items with high price volatility.
When to Use
Moving Average works well for commodity items, consumables, and businesses that don't need lot-level cost tracking. It is the most common valuation method in ERPNext India deployments.
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Related Terms
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