Average Cost changed and now closed periods' COGS has changed.

Let me help you get the Avg Cost Value get back to the correct amount, Yeazel. 

Possible data damage in your company file might have caused the Avg Cost value to change. Let's use the Rebuild Data tool that can resolve common data problems in QuickBooks Desktop. 

Here's how:

1. Go to the File menu, select Utilities, and then click Rebuild Data.
2. Click OK, then follow the onscreen steps to save a backup.
3. Let the tool repair your file. It may take some time. QuickBooks may seem stuck, but as long as you can move your mouse, the tool is working.
4. When the tool finishes, select OK.
5. Go back to the File menu, select Utilities, and then click Verify Data.
6. Let the tool check your file for data issues.

Once done, go back to the inventory report and check if the Avg Cost value has gone back to $0.01. 

We might also need to run a couple of reports and take a closer look at your company file just in case the issue persists. To do that, please contact our phone or chat support teams so they can help you further with this. Here's an article where you can get their contact details: Contact QuickBooks Desktop Support.

I'd also like to share these additional articles about inventories just in case you might need them in the future: 

• Fix Negative Inventory Issues in QuickBooks Desktop
• Balance Sheet and Inventory/Stock Valuation Reports Show Different Amounts for Inventory Asset Accou...

Add a reply below or reach out to us anytime you need anything else when working in QuickBooks. We're always here to help and guide you. 

I have tried Re-build Data and File Doc. Neither of these have resolved the Avg Cost issue/ change in closed period financials.  I'm waiting a call back from Support, but am open to whoever can help.

Let me provide some information about the average cost and guide you on how to fix it, Yeazel.

QuickBooks uses the weighted average cost to determine the value of your inventory and the amount debited to COGS when you sell inventory.. You can run the Inventory Valuation Summary report.to check how QuickBooks got the item's average cost or to check why this changes. To do this, follow the steps below:

1. Select Reports, then select Inventory.
2. Select Inventory Valuation Summary then set the dates to All.
3. Double-click the item in question.
   
   

However, if the report is showing that there are still changes made and confirm that it wasn't the correct figures showing, I suggest contacting our support team again. This way, they'll be able to investigate this further and help you drill down your reports.

For your reference, you can add or remove information on the header/footer, and even personalize the fontt and style of the report. Read this article so you'll be guided: Customize reports in QuickBooks Desktop.

Let me know if you have any concerns with the average cost. The Community is always here for you 24/7.

I had to call into QB Desktop Support and they have to forward my issue to Advanced Team for investigation on why all of a sudden my Avg Cost changed.

Hello Yeazel,

Did you ever get an answer to this?  We've just realized we have the same problem - our average cost has changed retroactively on items involved in Build Assemblies (either components or the built item).  I cannot find any answers, and it seems no one helped you, either.

Thank you so much.

Karen

@kchris10 

You may want to look at the inventory history for items in the build assemblies.  If any of those items on-hand quantity went negative (were oversold), and were then received on a bill or the inventory was adjusted, QB will make retroactive adjustments to COGS for the oversold items if the cost on the bill or inventory adjustment differs from the average cost used to calculate COGS on the oversold items.  It makes sense because when you oversell an item, QB has to use the last known average cost.  If you then subsequently receive an item at a different cost, an adjustment should be made as of the invoice date or inventory adjustment date to reflect the updated COGS.  I can't say for sure that's what's happening but it's a place to start.  Allowing inventory go negative is something you want to avoid.     

Hi Rainflurry,

Thank you so much for your thoughtful and logical response.  Awhile back we also discovered that allowing inventory to go negative impacts average cost.  We corrected all errors caused by that situation, and we now avoid it like the plague.  

Our current issue appears to have something to do with the Build Assembly routine.  We have hundreds of items, but only transactions with the items involved in Build Assemblies were impacted - 18 items in total.  

I welcome any other ideas or advice!

Thank you,

Karen

This didn't fix my problem. My cost and average cost don't match, eventhough I have a a new business and a new quickbooks account.

Hello there, JS87.

Let me share more details about the cost and average cost that don't match in QuickBooks.

In this case, the Cost and Average Cost don't usually match since the total cost means the sum of all costs, including fixed and variable costs. The Average cost is calculated by dividing the total cost of goods available by the total items available for sale. 

Additionally, QuickBooks posts the current average cost to COGS when you sell items that you do not have in stock. It then compares these costs to the average cost used when you sell items you purchase, and if there is a discrepancy, QuickBooks makes an adjustment entry to both COGS and inventory assets. For additional information on calculating average cost and reports that are useful for inventory management, see Understanding Inventory Assets and Cost of Goods Sold Tracking.

Let me know in the comment section if you need more help in accomplishing your other QuickBooks tasks. I'll be right here to keep assisting.

Hi,

I am not sure if IRS will be ok that there is a discrepancy of $20,000. I think started the business right is more important for me. QB didn't read the correct avg cost data through the IIF file.

Hello there, @amynhemani.

I can see a duplicate post for this exact query you posted. My colleague, JamaicaA, has already answered similar question you've posted. You can view her answer through this thread: Problem with average cost.

Don't hesitate to keep in touch if you need anything else about inventories. As always, the Community is always here to attend to your concerns. Have a great day.