--- title: Expected Cost Price vs. Cost Price description: In Rackbeat, a distinction is made between the expected cost price and the cost price. Here's an overview of the difference --- [Skip to content](https://helpdesk.rackbeat.com/knowledge/ht-00106#main-content) - [English](https://helpdesk.rackbeat.com/knowledge/ht-00106) - [Dansk](https://helpdesk.rackbeat.com/da/knowledge/ht-00106) - [Norsk – Norge](https://helpdesk.rackbeat.com/no-no/knowledge/ht-00106) - [Svenska](https://helpdesk.rackbeat.com/sv/knowledge/ht-00106) English Show submenu for translations [Contact us](https://helpdesk.rackbeat.com/knowledge/kb-tickets/new?hsLang=en) Open main navigation Close main navigation - - [English](https://helpdesk.rackbeat.com/knowledge/ht-00106) - [Dansk](https://helpdesk.rackbeat.com/da/knowledge/ht-00106) - [Norsk – Norge](https://helpdesk.rackbeat.com/no-no/knowledge/ht-00106) - [Svenska](https://helpdesk.rackbeat.com/sv/knowledge/ht-00106) English Show submenu for translations - [Contact us](https://helpdesk.rackbeat.com/knowledge/kb-tickets/new) - [AI Chat](https://chat.applai.io/chatbot/W5EFe14XJ8mW0OlrIzTS) [AI Chat](https://chat.applai.io/chatbot/W5EFe14XJ8mW0OlrIzTS) How can we help you? - There are no suggestions because the search field is empty. 1. [Helpdesk](https://helpdesk.rackbeat.com/knowledge?hsLang=en) 2. [GETTING STARTED / SETUP](https://helpdesk.rackbeat.com/knowledge/getting-started-setup?hsLang=en) 3. [For new agreements](https://helpdesk.rackbeat.com/knowledge/getting-started-setup?hsLang=en#for-new-agreements) # Expected Cost Price vs. Cost Price ## In Rackbeat, a distinction is made between the expected cost price and the cost price. Here's an overview of the difference ### Expected Cost Price The expected cost price is the price Rackbeat will default to when an item is to be ordered from a supplier. In practice, this means that Rackbeat will, by default, use this price for the product when a purchase order is created. This does *not* mean that the product must be purchased at this price—of course, it can always be adjusted, as prices may vary from order to order. The expected purchase price does *not* determine the actual unit value of the item in inventory—it is simply a helpful reference in the purchasing process. You enter the expected cost price yourself under the product information. ![image-png-Apr-07-2025-01-01-19-6722-PM expect. cost price vs cost price 1](https://helpdesk.rackbeat.com/hs-fs/hubfs/image-png-Apr-07-2025-01-01-19-6722-PM%20expect.%20cost%20price%20vs%20cost%20price%201.webp?width=540&height=313&name=image-png-Apr-07-2025-01-01-19-6722-PM%20expect.%20cost%20price%20vs%20cost%20price%201.webp) --- ### Cost Price The cost price reflects the actual inventory value of a given product in stock – therefore, a product does not have a cost price if there is no stock available. Since a product can be purchased at different prices over time, the unit value of a product may change continuously. As such, the cost price of a product directly affects the total value of the inventory. The method by which this value is calculated depends on the chosen inventory valuation principle. In Rackbeat, you can work with either **Average Cost Price** or **FIFO (First In, First Out)**. - If the **Average Cost Price** method is used, the inventory value is calculated based on the average purchase price of the product. - If **FIFO** is used, the total inventory value is calculated differently – here, the value of the inventory is determined by the principle that the first products purchased are also the first ones sold. ### How to Adjust Cost Price The cost price is automatically calculated by the system based on inventory movements. Therefore, you cannot change the cost price directly on the product. If you want to override the cost price, the following conditions must be met: - There must be stock available - The quantity cannot be 0, otherwise the cost price cannot be changed Adjust the Cost Price via an Adjustment 1. Go to **Products → Adjustments** 2. Create an adjustment where you modify the cost price of the product Changes to the cost price will affect the total inventory value of the product. 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