At times, it is necessary to adjust inventory counts. This may be necessary to correct an unknown processing error, or to enter beginning balances. Go to Inventory > Inventory Items > Count tab and click on the Adjustments button and the following window will open:
The Inventory Adjustment dialog displays the Original on-hand amount which should equal the amount on the shelf or display. The on-hand counts are increased as soon as items are received on the purchase order (Received quantity populated) or decreased when the items are pulled for an order (Ship To quantity populated on the sales order).
Enter either the New on-hand amount or an Adjustment amount.
Enter the unit value of the inventory on hand in the Unit Value field. The inventory asset value will be incremented by the cost value.
Enter the adjustment Date of the inventory count. When entering the beginning amount of an item on hand, use a date within the last fiscal year so the year-end balances reflect the total value of the inventory on hand at the beginning of the New Year.
Enter a Description of why the adjustment is being made.
The following transaction will be created if the inventory item is classified as Track Count or other perpetual inventory classification.
|
Debit |
Credit |
Amount |
|
Inventory Asset Account |
Inventory Variance |
Adjustment Value (The value will be negative if the count has been reduced) |
The actual transactions can be viewed by clicking Inventory > Display Unposted Transactions > By G/L Account to open the following summary list:
The following transaction will be created if the inventory item is classified as No Count or Service or other non-inventory item.
|
Debit |
Credit |
Amount |
|
Inventory Variance |
Inventory Variance |
Adjustment Value |
Since both the debit and credit transaction are posted to the same inventory variance account, the general ledger will not be affected. These transactions will adjust the inventory history value. Review the Inventory > Inventory Items > Inventory History for more details on inventory history.
Use the inventory adjustment screen sparingly. It is best to enter or correct a sales order or purchase order if a known mistake was made. Adjust the inventory count using the instructions above when the count does not match the total inventory on hand or beginning inventory needs to be entered.