The purchase order module can be configured to default to one these four values, plus an option to use the vendor cost defined in IC Vendor Details. Timing is important to understand when creating a purchase order. The value entered on the PO is set when the line item is created on the PO. Any subsequent cost updates made after the PO is initially created will not be reflected on the PO. Of course, when the PO is received and invoiced, the actual costs will be reflected and the various costs will be updated accordingly for future transactions.
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Choosing a default costing method does not determine the accounting value for your inventory but it can be an aid to ensure the PO cost will default to the most accurate cost based upon your business and industry.
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