How do most people handle a situation like this? On a purchase order you order 100 WIDGETS at $1.00 a piece. Vendor ships you 105 and only bills you for 100 and will never bill you for the extra 5. Now what you should have in inventory is 100 at $1.00 cost plus 5 at zero cost but some clients insist that they have 105 in stock at $1.00 cost. Given the valuation method eventually those 5 get sold and now your COGS amount will be thrown off not to mention you never want the last originating cost to be zero because that is bogus. What is best practice in situations like this?
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