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Getting Started
Initial Setup
Purchase Management
Sales Management
Inventory Management
Production Management
Reports & Analytics
User Guide Article

FIFO Cost LOT Tracking

Overview

The FIFO Cost LOT Tracking report is used to track inventory lots and their costs based on the First-In, First-Out (FIFO) method. It helps users identify the sequence in which inventory lots are received and the corresponding cost assigned to stock movements.

FIFO Cost LOT Tracking

FIFO costing assumes that the inventory received first is consumed or issued first. Each inventory receipt is maintained as a separate lot with its associated quantity and cost.

The system tracks:

  • Product
  • Inventory lot
  • Receipt quantity
  • Cost per unit
  • Quantity issued
  • Remaining quantity
  • Applicable FIFO cost

FIFO Lot Tracking Process

The FIFO process follows the chronological order of inventory receipts:

  1. Inventory is received and recorded as a lot.
  2. The quantity and cost of the lot are maintained.
  3. When inventory is issued, the earliest available lot is considered first.
  4. The issued quantity is deducted from the oldest available lot.
  5. If the issue quantity exceeds the remaining quantity of the first lot, the balance quantity is taken from the next available lot.
  6. Remaining quantities continue to be tracked against their respective lots.

Lot Cost Calculation

Each inventory lot maintains its own cost based on the applicable purchase or receipt transaction.

When stock is issued, the FIFO method determines the cost by using the oldest available inventory lot first. If multiple lots are required to satisfy an issue quantity, the cost is calculated based on the respective quantities and costs of those lots.

Inventory Balance

FIFO Cost LOT Tracking maintains the remaining quantity and cost of each available inventory lot.

This allows users to identify:

  • Quantity received under each lot
  • Cost associated with each lot
  • Quantity consumed or issued
  • Remaining quantity in each lot
  • Cost of the remaining inventory

FIFO Cost Tracking

The report provides visibility into inventory costing based on the chronological order of stock receipts. It helps maintain accurate lot-level cost information and supports inventory valuation and stock cost analysis.

Inventory Valuation

The remaining inventory value is determined from the quantities and costs of the available lots under the FIFO method. Older inventory lots are considered before newer lots when calculating the cost of stock issued.