Beginning inventory balance, add items
Hi, we currently maintain a spreadsheet of inventory items with the ending value recorded in the assets account for inventory and matched to the spreadsheet. I want to move these items into MYOB -
1. I have managed to import all the items using a code and their description, and accounts for buy, sell and inventory.
2. My question is how do I get the quantities of the items into MYOB so that the COGS calculates? Would I need to enter in the last cost of the item into the "standard cost" box to ensure that happens?
3. Going forward, whatever the last cost of the item is would be what we would use. I understand there is a check box in preferences that I should not select to ensure this happens.
Please confirm/advise how to proceed?
Hi ARAP_2020
Generally speaking, if you have not used the Inventory module before within AccountRight if you use the Inventory>>Count Inventory function you can enter the required number of each item. Upon selecting to Adjust the Inventory you would be prompt to enter that count as an opening balance:
This will go through and generate the necessary opening balances record for those items. Note: If you have used the inventory before in the company file you would not receive that prompt and it will adjust the inventory according to the default adjustment account selected by the user.
If you have used Inventory before or just wish to adjust inventory you can either use the Count Inventory function or Adjust Inventory function to generate that one. Count Inventory basically feeds into Adjust Inventory, you just enter the quantity and AccountRight generates the Adjust Inventory transaction for you to review or adjust before recording. Although, you are welcome to bypass this step and use the Adjust Inventory function. More information on those functions can be found on Help Articles: Recording stocktakes and Making inventory Adjustments.
Once you have added the quantity on hand and the value of the inventory, the system will calculate the average cost of the item, which in turn, is used for the cost of sales amount. (Current value / Quantity on Hand) = Average Cost, Average Cost x items being sold = Cost of sales amount.
When you record a bill by default the system will use the Last Purchase Price of that item (can be seen in the Buying Details of the Item record). If you wish to use the Standard Cost of the item, Setup>>Preferences>>Inventory - Use Standard Cost as the Default Price on Purchase Orders and Bills needs to be enabled. If that preference is not enabled, the Last Purchase Price of the item will be used.
