From bf266d82e73878f62c8699fcf36fd75263e5311f Mon Sep 17 00:00:00 2001
From: marination <maricadsouza221197@gmail.com>
Date: Tue, 28 Dec 2021 01:27:24 +0530
Subject: [PATCH] chore: Added .md file to explain stock ageing business logic

(cherry picked from commit c007f84ade706e1738e4d964f291bfe4ab3aa948)
---
 .../stock/report/stock_ageing/stock_ageing.py |  3 +-
 .../stock_ageing/stock_ageing_fifo_logic.md   | 73 +++++++++++++++++++
 2 files changed, 74 insertions(+), 2 deletions(-)
 create mode 100644 erpnext/stock/report/stock_ageing/stock_ageing_fifo_logic.md

diff --git a/erpnext/stock/report/stock_ageing/stock_ageing.py b/erpnext/stock/report/stock_ageing/stock_ageing.py
index 5f0f6cd48d4..00cde40a90e 100644
--- a/erpnext/stock/report/stock_ageing/stock_ageing.py
+++ b/erpnext/stock/report/stock_ageing/stock_ageing.py
@@ -400,8 +400,7 @@ class FIFOSlots:
 
 		warehouse_results = (
 			frappe.qb.from_(warehouse)
-				.select("name")
-				.where(
+				.select("name").where(
 					(warehouse.lft >= lft)
 					& (warehouse.rgt <= rgt)
 				).run()
diff --git a/erpnext/stock/report/stock_ageing/stock_ageing_fifo_logic.md b/erpnext/stock/report/stock_ageing/stock_ageing_fifo_logic.md
new file mode 100644
index 00000000000..5ffe97fd742
--- /dev/null
+++ b/erpnext/stock/report/stock_ageing/stock_ageing_fifo_logic.md
@@ -0,0 +1,73 @@
+### Concept of FIFO Slots
+
+Since we need to know age-wise remaining stock, we maintain all the inward entries as slots. So each time stock comes in, a slot is added for the same.
+
+Eg. For Item A:
+----------------------
+Date | Qty | Queue
+----------------------
+1st  | +50 | [[50, 1-12-2021]]
+2nd  | +20 | [[50, 1-12-2021], [20, 2-12-2021]]
+----------------------
+
+Now the queue can tell us the total stock and also how old the stock is.
+Here, the balance qty is 70.
+50 qty is (today-the 1st) days old
+20 qty is (today-the 2nd) days old
+
+### Calculation of FIFO Slots
+
+#### Case 1: Outward from sufficient balance qty
+----------------------
+Date | Qty | Queue
+----------------------
+1st  | +50 | [[50, 1-12-2021]]
+2nd  | -20 | [[30, 1-12-2021]]
+2nd  | +20 | [[30, 1-12-2021], [20, 2-12-2021]]
+
+Here after the first entry, while issuing 20 qty:
+- **since 20 is lesser than the balance**, **qty_to_pop (20)** is simply consumed from first slot (FIFO consumption)
+- Any inward entry after as usual will get its own slot added to the queue
+
+#### Case 2: Outward from sufficient cumulative (slots) balance qty
+----------------------
+Date | Qty | Queue
+----------------------
+1st  | +50 | [[50, 1-12-2021]]
+2nd  | +20 | [[50, 1-12-2021], [20, 2-12-2021]]
+2nd  | -60 | [[10, 2-12-2021]]
+
+- Consumption happens slot wise. First slot 1 is consumed
+- Since **qty_to_pop (60) is greater than slot 1 qty (50)**, the entire slot is consumed and popped
+- Now the queue is [[20, 2-12-2021]], and **qty_to_pop=10** (remaining qty to pop)
+- It then goes ahead to the next slot and consumes 10 from it
+- Now the queue is [[10, 2-12-2021]]
+
+#### Case 3: Outward from insufficient balance qty
+> This case is possible only if **Allow Negative Stock** was enabled at some point/is enabled.
+
+----------------------
+Date | Qty | Queue
+----------------------
+1st  | +50 | [[50, 1-12-2021]]
+2nd  | -60 | [[-10, 1-12-2021]]
+
+- Since **qty_to_pop (60)** is more than the balance in slot 1, the entire slot is consumed and popped
+- Now the queue is **empty**, and **qty_to_pop=10** (remaining qty to pop)
+- Since we still have more to consume, we append the balance since 60 is issued from 50 i.e. -10.
+- We register this negative value, since the stock issue has caused the balance to become negative
+
+Now when stock is inwarded:
+- Instead of adding a slot we check if there are any negative balances.
+- If yes, we keep adding positive stock to it until we make the balance positive.
+- Once the balance is positive, the next inward entry will add a new slot in the queue
+
+Eg:
+----------------------
+Date | Qty | Queue
+----------------------
+1st  | +50 | [[50, 1-12-2021]]
+2nd  | -60 | [[-10, 1-12-2021]]
+3rd  | +5  | [[-5, 3-12-2021]]
+4th  | +10 | [[5, 4-12-2021]]
+4th  | +20 | [[5, 4-12-2021], [20, 4-12-2021]]
\ No newline at end of file