How to determine purchase issue ratio

How to determine purchase issue ratio

Inventory Management

Informational 

Divide number of individual items purchased by the number of individual items issued at a time:

• Ex.: Purchase items by the case (4 to a case), but issue them individually.  Ratio would be 4 (4 divided by 1). 

• Ex.: Purchase items individually, but issue them in packs of 20.  Ratio would be 0.05 (1 divided by 20).

• Upon receipt, the number of items received is multiplied by the purchase issue ratio to come up with the total items received.
• Unit price is determined by dividing the receiving unit cost by the purchase issue ratio.