Comment 33 for bug 610738

code below is for V6 and updates both stock valuation and GL correctly to keep aligned.

# Average price computation
                #2/4/2013 - have raised bug report 1163060 (see also 610738) to get the change made below
                #included in the core product. The problem is that purchase returns were
                #not being catered for - code below does.
                #the bug exists in V7 so can be fixed there.

                if pick.purchase_id and move.product_id.cost_method == 'average':
                    product = product_obj.browse(cr, uid, move.product_id.id)
                    move_currency_id = move.company_id.currency_id.id
                    context['currency_id'] = move_currency_id
                    qty = uom_obj._compute_qty(cr, uid, product_uom, product_qty, product.uom_id.id)

                    if pick.type == 'in':
                        if product.id in product_avail:
                            product_avail[product.id] += qty

                    #for a return, get the price from the move. if none, use average cost
                    if pick.type == 'out':
                        if move.price_unit:
                            product_price = move.price_unit
                        else:
                            product_price = product.price_get('standard_price', context)[product.id]

                    new_price = currency_obj.compute(cr, uid, product_currency,
                                move_currency_id, product_price)
                    new_price = uom_obj._compute_price(cr, uid, product_uom, new_price,
                                product.uom_id.id)

# if qty > 0:
                    if pick.type == 'in':
                        if product.qty_available == 0 or (product.qty_available + qty) == 0 :
                            new_std_price = new_price
                        else:
                            # Get the standard price
                            amount_unit = product.price_get('standard_price', context)[product.id]
                            new_std_price = ((amount_unit * product.qty_available)\
                                + (new_price * qty))/(product.qty_available + qty)

                    else:
                        if product.qty_available == 0 or (product.qty_available - qty) == 0:
                            new_std_price = new_price
                        else:
                            # Get the standard price
                            amount_unit = product.price_get('standard_price', context)[product.id]
                            new_std_price = ((amount_unit * product.qty_available)\
                                + (new_price * (0-qty)))/(product.qty_available -qty)

                        # Write the field according to price type field
                    product_obj.write(cr, uid, [product.id], {'standard_price': new_std_price})

                        # Record the values that were chosen in the wizard, so they can be
                        # used for inventory valuation if real-time valuation is enabled.
                    move_obj.write(cr, uid, [move.id],
                                {'price_unit': product_price,
                                 'price_currency_id': product_currency})

                #this section handles customer returns

                elif pick.sale_id and move.product_id.cost_method == 'average' and pick.type == 'in':
                    product = product_obj.browse(cr, uid, move.product_id.id)
                    move_currency_id = move.company_id.currency_id.id
                    context['currency_id'] = move_currency_id
                    qty = uom_obj._compute_qty(cr, uid, product_uom, product_qty, product.uom_id.id)

                    #for a return, get the price from the move. if none, use average cost
                    if move.price_unit:
                        product_price = move.price_unit
                    else:
                        product_price = product.price_get('standard_price', context)[product.id]

                    new_price = currency_obj.compute(cr, uid, product_currency,
                                move_currency_id, product_price)
                    new_price = uom_obj._compute_price(cr, uid, product_uom, new_price,
                                product.uom_id.id)

                    if product.qty_available == 0 or (product.qty_available + qty) == 0 :
                        new_std_price = new_price
                    else:
                        # Get the standard price
                        amount_unit = product.price_get('standard_price', context)[product.id]
                        new_std_price = ((amount_unit * product.qty_available)\
                            + (new_price * qty))/(product.qty_available + qty)

                        # Write the field according to price type field
                    product_obj.write(cr, uid, [product.id], {'standard_price': new_std_price})

                        # Record the values that were chosen in the wizard, so they can be
                        # used for inventory valuation if real-time valuation is enabled.
                    move_obj.write(cr, uid, [move.id],
                                {'price_unit': product_price,
                                 'price_currency_id': product_currency})

                #writing the average cost to the move record
                #so that it can be used for a sale return

                elif pick.sale_id and move.product_id.cost_method == 'average' and pick.type == 'out':
                    product = product_obj.browse(cr, uid, move.product_id.id)
                    move_currency_id = move.company_id.currency_id.id
                    context['currency_id'] = move_currency_id
                    qty = uom_obj._compute_qty(cr, uid, product_uom, product_qty, product.uom_id.id)
                    product_price = product.price_get('standard_price', context)[product.id]
                    move_obj.write(cr, uid, [move.id],
                                {'price_unit': product_price,
                                 'price_currency_id': product_currency})