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Package Unit Cost Inheritance and Calculation

How Flourish sets the unit cost of a new package created from one or more source packages, including when it falls back to the item's Standard Unit Cost.

Table of Contents

When you create a package from one or more source packages, Flourish sets the new package's unit cost automatically. It uses the actual cost of the source packages when there is one, and falls back to the item's Standard Unit Cost when there isn't.

How the unit cost is set

  1. If the total cost of the source packages is greater than $0, Flourish spreads that total across the new units and uses the result as the unit cost.
  2. If the total cost of the source packages is $0, Flourish uses the Standard Unit Cost set on the item you're creating.
  3. If the total is $0 and the item has no Standard Unit Cost, Flourish uses the unit cost entered on the creation screen. If that is blank, the new package has no cost.

Only the total matters. If at least one source package has a cost, Flourish uses the actual cost and ignores the Standard Unit Cost, even if other sources are $0.

How the actual cost is calculated

  1. For each source package, multiply its unit cost by the quantity you used.
  2. Add those amounts together to get the total source cost.
  3. Divide the total by the number of units you're creating (number of packages × quantity per package). If you create packages of different sizes in one step, add up the units across all of them.

Examples

In each example you're creating Item C from Item A and Item B. Item C has a Standard Unit Cost of $5.00.

Example 1: All source packages have a cost
  • Item A: unit cost $10 × 10 used = $100
  • Item B: unit cost $5 × 10 used = $50
  • Total source cost = $150

You create 5 packages of 10 units each, which is 50 units. The unit cost is $150 ÷ 50 = $3.00. This replaces the Standard $5.00.

Example 2: All source packages have no cost
  • Item A: unit cost $0 × 10 used = $0
  • Item B: unit cost $0 × 10 used = $0
  • Total source cost = $0

The total is $0, so Flourish uses the Standard Unit Cost. The new unit cost is $5.00.

Example 3: Some source packages have a cost
  • Item A: unit cost $0 × 10 used = $0
  • Item B: unit cost $5 × 10 used = $50
  • Total source cost = $50

You create 5 packages of 10 units each, which is 50 units. The unit cost is $50 ÷ 50 = $1.00. One source has a cost, so Flourish uses the actual cost instead of the Standard $5.00.

Tips

  • To avoid a surprise Standard Unit Cost on a new package, check that your source packages have costs before you create from them.
  • If the new package's unit cost isn't what you expect, check the unit cost on each source package and the Standard Unit Cost on the new item.

How did we do?

Flourish Accounting Overview

Managing Chart of Accounts View - QuickBooks Online

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