Inventory receipt cost allocation methods for additional costs

Breww supports distributing your inventory receipt’s additional costs amongst your purchased items in a number of ways. Here we break down how each method is calculated so that you can decide which best works for your situation and costs.

Example

We’ll use the example of a £60.00 delivery cost spread over three purchased items, all at £30.00 per kg.

  1. 100 kg of Amarillo
  2. 75 kg of Citra
  3. 50 kg of El Dorado

Allocate evenly

If Allocate evenly is chosen, Breww simply divides the total cost by the number of lines on the inventory receipt and allocates that amount per line.

In this example, that would be £60.00 / 3 = £20.00 of additional cost added per line. This figure is added to the total cost of the line.

Allocate proportionally based on quantity

If this option is chosen, Breww calculates the total quantity of the items on the inventory receipt, which is 200 kg in this example. Then Breww allocates the cost proportionally amongst each line:

  1. 100 kg of Amarillo: (100 kg / 200 kg) x £60.00 = £30.00
  2. 75 kg of Citra: (75 kg / 200 kg) x £60.00 = £22.50
  3. 25 kg of El Dorado: (50 kg / 200 kg) x £60.00 = £15.00

Allocate proportionally based on price

This option works similarly to Allocate proportionally based on quantity but instead calculates the total price of all lines and allocates the cost proportionally amongst each line. In this example, the total price of all items is £6,000.

  1. 100 kg of Amarillo: (£3,000 / £6,000) x £60.00 = £30.00
  2. 75 kg of Citra: (2,250 kg / £6,000) x £60.00 = £22.50
  3. 25 kg of El Dorado: (1,500 kg / £6,000) x £60.00 = £15.00