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Re: Initial inventory, cancelling invoice, operating manual

On Tue, Sep 9, 2008 at 7:53 PM, Jeff Kowalczyk <..hidden..> wrote:
> On Mon, 16 Jul 2007 13:00:34 -0700, Chris Travers wrote:
>> > What is the best way to introduce initial inventory to the system? We
>> > have a couple of houndreds of different items.
>> Use a vendor invoice.  This is required for correct COGS tracking.
> Could you expand on this? If the initial inventory is already on hand, who
> (what account) will eventually pay this vendor invoice?

Here is a little more context-- to do an initial setup, I would
suggest the following steps:

1)  Create a generic vendor for the initial vendor import (we do this
in 1.3 already because inventory adjustments upward hit that vendor)

2)  Create a vendor invoice for everything you have on-hand.  Pay that
invoice out of an asset account.

3)  GL adjustment to all appropriate accounts.

The above ought to be something that should be eventually subject to automation.

The reason for this procedure is that this way the parts are tracked
properly so that you have material in the inventory account, and when
it is sold, we move that value to the cogs account.

> A preliminary test with 1.2.x indicates that this initial inventory only
> becomes available for menu|shipping|receive if I use a purchase order, and
> later convert that to a vendor invoice. Is that correct initial inventory
> procedure?

Menu/Shipping/Receive is to track incoming parts against purchase
orders.  Similarly Menu/Shipping/Ship tracks outbound parts against
sales orders.  Hence this is specific to order fulfillment workflows.
A part with no purchase order but which has an invoice shows up as
available to be shipped in the interface when you have an open sales
order.  Does this make sense?

Best Wishes,
Chris Travers