Last month’s discussion of price levels brought up the possibility of using formulas to set prices.  So this month we’ll cover how to use price formulas in Sage 50/Peachtree.

To set up formulas that affect all inventory items, go to Maintain – Default information – Inventory Items.  On the Price Levels tab you will see a row for each price level.  At the end of each row is a button that lets you edit the formula for that price level.
Click the button on Price Level 1.  In the Use drop down list there are two choices: Last Cost, and No Calculation.  Obviously No Calculation means you aren’t going to use a formula, so let’s choose Last Cost.  In the next drop down list you have four choices: Increase by Percent, Increase by Amount, Decrease by Percent, and Decrease by Amount.  In the next box you can enter the amount or percent by which you want to increase or decrease Last Cost to calculate an amount for Price Level 1. I can’t think of any situation where you would want to calculate your selling price by decreasing last cost, but the choice of actions are the same regardless of what you entered at Use.  I’ll assume that you are smart enough to not set your selling prices below your cost.
The final option is for rounding.  You can choose from:

  • No Rounding – to use prices exactly as they are calculated
  • Specific Cent – if you choose this, another field will appear so you can enter the amount you want prices rounded to, such as 0.99 if all prices should end with 99 cents.
  • Next Dollar – rounds prices up to the next whole dollar

If you click the Edit button on any other row, you will find that there is one more option in the Use box.  In addition to Last Cost, and No Calculation there is a choice for Price Level 1.  This is very helpful if you want to use price level 1 as list price, then other price levels can be markdowns from list price.

Of course, you may not want use the same calculations for every item you sell.  So Sage 50/Peachtree also lets you set up formulas for specific items.  You can go to Maintain – Inventory Items, select an item and click the button next to the price.   The only difference in the options here is that in addition to last cost or price level 1, you can choose to use the current price in calculating the new price.  The formula you set here will only affect this item.

One important thing to understand about price formulas is that they only recalculate when you tell them to.

To recalculate prices for one item, open that item in Maintain – Inventory Items and click the button next to the price.  At the top of the Multiple Price Levels window, click the Recalculate button.

To recalculate prices for all items or a group of items, go to Maintain – Item Prices.  If you want all items, just click OK at the filter selection.  If you only want to change prices for some items, set whatever filters you need.  Click OK and you will get a list of items that match your filter.  You can de-select individual items using the check boxes on the right to further limit your selection.  At the top left you can choose which price levels you want to recalculate.

At Select Method of adjustment you have 3 options:

  • Level’s current calculation, and new cost information – While the help doesn’t make this clear, by my tests, this choice will only recalculate items that have their own price formulas applied in Maintain – Inventory Items.
  • Level’s default calculation – This choice will recalculate all selected items using the default formula for that price level, even if a different formula has been applied to an item in Maintain – Inventory Items.
  • Calculation selected below – Let’s you select a formula to be used this time only.

Click the Recalc button at the top of the window to calculate new prices.  After calculating you can manually adjust prices if needed.  If you decide not to keep the changes or want to start over, just close the windows and don’t save the changes.