Average Cost
When new stock is combined with old stock, the new price often overstates the value of stock holding. The better method is to combine the total value of investment in stock, old and new, and divide by the total number of units to calculate the average cost. This is a very accurate method of establishing stock holding.
Read more about this topic: Cost Price, Forms
Famous quotes containing the words average and/or cost:
“Personally, I can’t see why it would be any less romantic to find a husband in a nice four-color catalogue than in the average downtown bar at happy hour.”
—Barbara Ehrenreich (b. 1941)
“It may cost me twenty thousand francs; but for twenty thousand francs, I will have the right to rail against the iniquity of humanity, and to devote to it my eternal hatred.”
—Molière [Jean Baptiste Poquelin] (1622–1673)