MONTH END INVENTORY PROCEDURE

Ledger > Month End Inventory

Depending upon the preferences set in PERFECT FIT, adjustments to inventory will not update the ledger balances for inventory. This procedure will setup the ledger to insert adjustments to bring the ledger inventory amounts into balance with the inventory quantities and value in the Inventory file.

This procedure does not do anything that can not be done manually. If the inventory quantities or values in PERFECT FIT are not accurate, then these transactions will not be accurate.

Regardless of when this procedure is run, it will do it’s calculation for inventory values as of TODAY, and the cost of goods sold values as of the previous month. For this reason, to maintain highest accuracy, it should be run on the first day of each month, before any invoices or inventory adjustments are entered.

The procedure will set up a series of ledger entries. After viewing the proposed entries, the user can click CANCEL and no entries will be made.

The ledger entries are set up as follows:

Adjustment to Finished Inventory in Stock, using Value, as of TODAY
Adjustment to Raw Materials in Stock, using Value, as of TODAY
Adjustment to Work in Process, using Value, as of TODAY
This is calculated as the value of Raw Materials that have been allocated on Cut Tickets.
Adjustment to Cost of Goods Sold, FOR THE PREVIOUS MONTH ONLY, using the invoice line item value figures.
Discrepancies are set up to post to INVENTORY PENDING. See user guide #331. Pending often gets reposted to Cost of Goods Sold.

This information can all be supported using reports built into PERFECT FIT.
Ledger > Reports > Trial Balance as of TODAY
Inventory Reports > Status > Current Status > In Stock, Money Report
Inventory Reports > Parts > Value (In Stock, or Available, depends on WIP)
Inventory Reports > Allocation (WIP) > Allocated Parts
Invoices > Reports > Invoice Costs/Profit, Search the PREVIOUS month.