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# How to calculate weighted average cost (WAC) in eZee Burrp Backoffice 7.0?

What is Weighted Average Cost?
Weighted Average Cost is a method of calculating Ending Inventory cost that is

Number of goods from Beginning Inventory + Purchases/Production

Example:  Onion (Red) menu item have two units (1 Kilo = 1000 gram )
Suppose a trader buys commodity on four occasions = Total Purchase = 5000 Gram
1. GRN CSGRN#3 Purchased    1 KG (1000 gram)      =  Rate \$5 per gram      = 5000\$
2. GRN CSGRN#4 Purchased    0.5 KG (500 gram)     = Rate \$4 per gram       = 2000\$
3. GRN CSGRN#5 Purchased    2 KG (2000 gram)      = Rate \$4.5 per gram    = 9000\$
4. GRN CSGRN#6 Purchased   1.5 KG (1500 gram)   = Rate \$4.8 per gram    = 7200\$

1. Average Purchase Cost = GRN Cost/GRN Qty
Here Average Purchase Price is (5+4+4.5+4.8)= 18.3 /4 =  4.56

2. Weighted Average Cost = Stock level rate + purchase rate + received Rate / Stock level qty + purchase qty + received Qty  i.e. Current Stock Value/Current Stock. However, the weighted average, taking into account the amount purchased on each transaction is
[(1000X5) + (500X4) + (2000X4.5) + (1500X4.8)]/5000=  (5000+2000 +9000+7200)/5000 = 23200/5000 = 4.64 per gram

Screenshot 1: Kindly do WAC settings Screenshot 2: Add Good receipt note entry as per your purchase Screenshot 3: Now run  WAC option after each GRN process Screenshot 4: WAC Report gives a complete calculation of WAC based on selected date and store Screenshot 5:
WAC Report Screenshot 6: 