Information about setting up pricing structures also is included.
• Part 3, Transactions, contains information about entering and posting inventory transactions and transfers.
I N V E N T O R Y C O N T R O L 3 I N T R O D U C T I O N
• Part 4, Inquiries and reports, describes windows and reports you can use to view your inventory information.
• Part 5, Utilities, includes information about completing special tasks, such as using price list wizards, reconciling inventory, removing history records, and adjusting average costs of items.
• Part 6, Routines, describes how you can use inventory checklists. Information about year-end closing tasks is also included.
Symbols and conventions
This documentation uses the following symbols and conventions to make specific types of information stand out.
The conventions table explains how we refer to chapters, sections, acronyms, and other information in the documentation set.
Resources available from the Help menu
The Microsoft Dynamics GP Help menu gives you access to user assistance resources on your computer, as well as on the Web.
Contents
Opens the Help file for the active Microsoft Dynamics GP component, and displays the main “contents” topic. To browse a more detailed table of contents, click the Contents tab above the Help navigation pane. Items in the contents topic and tab are arranged by module. If the contents for the active component includes an
“Additional Help files” topic, click the links to view separate Help files that describe additional components.
To find information in Help by using the index or full-text search, click the appropriate tab above the navigation pane, and type the keyword to find.
Symbol Description
The light bulb symbol indicates helpful tips, shortcuts and suggestions.
The warning symbol indicates situations you should be especially aware of when completing tasks. Typically, this includes cautions about performing steps in their proper order, or important reminders about how other information in Microsoft Dynamics GP may be affected.
The multicurrency symbol points out features or procedures that apply if you’re using Multicurrency Management.
Convention Description
Creating a batch Italicized type indicates the name of a section or procedure.
File >> Print or File > Print The (>>) or (>) symbol indicates a sequence of actions, such as selecting items from a menu or toolbar, or pressing buttons in a window. This example directs you to go to the File menu and choose Print.
TAB or ENTER Small capital letters indicate a key or a key sequence.
To save the link to a topic in the Help, select a topic and then select the Favorites tab.
Click Add.
Index
Opens the Help file for the active Microsoft Dynamics GP component, with the Index tab active. To find information about a window that’s not currently displayed, type the name of the window, and click Display.
About this window
Displays overview information about the current window. To view related topics and descriptions of the fields, buttons, and menus for the window, choose the appropriate link in the topic. You also can press F1 to display Help about the current window.
Lookup
Opens a lookup window, if a window that you are viewing has a lookup window.
For example, if the Checkbook Maintenance window is open, you can choose this item to open the Checkbooks lookup window.
Show Required Fields
Highlights fields that are required to have entries. Required fields must contain information before you can save the record and close the window. You can change the font color and style used to highlight required fields. On the Microsoft
Dynamics GP menu, choose User Preferences, and then choose Display.
Printable Manuals
Displays a list of manuals in Adobe Acrobat .pdf format, which you can print or view.
What’s New
Provides information about enhancements that were added to Microsoft Dynamics GP since the last major release.
Microsoft Dynamics GP online
Opens a Web page that provides links to a variety of Web-based user assistance resources. Access to some items requires registration for a paid support plan.
Customer Feedback Options
Provides information about how you can join the Customer Experience Improvement Program to improve the quality, reliability, and performance of Microsoft® software and services.
Send us your documentation comments
We welcome comments regarding the usefulness of the Microsoft Dynamics GP documentation. If you have specific suggestions or find any errors in this manual, send your comments by e-mail to the following address: [email protected].
To send comments about specific topics from within Help, click the Documentation Feedback link, which is located at the bottom of each Help topic.
Note: By offering any suggestions to Microsoft, you give Microsoft full permission to use
PART 1: SETUP
Use the following information to set up Inventory Control. Setup procedures generally need to be completed once, but you can refer to the information at other times for instructions on modifying or viewing existing entries.
You'll need to complete these setup procedures before using the procedures in Part 2, Cards, which describes how to create item records, and Part 3, Transactions, which describes accounting tasks specific to Inventory Control.
The following information is discussed:
• Chapter 1, “Overview,” describes how Inventory Control integrates with other modules, and discusses basic terms and concepts.
• Chapter 2, “Setup preparation,” explains tasks you must complete before you can begin setting up Inventory Control.
• Chapter 3, “Preferences and default settings,” contains information about setting preferences and default settings.
• Chapter 4, “Unit of measure schedules,” includes information about creating, modifying, and deleting unit of measure schedules.
• Chapter 5, “Standard pricing,” describes how to set up and maintain price levels and price groups if you’re using standard pricing.
• Chapter 6, “Lot category setup,” explains how you can use lot categories to track shared attributes of the items in a lot.
• Chapter 7, “Item classes,” contains information about setting up item classes, an optional step you can use to make defining new items quicker and more accurate.
• Chapter 8, “Stock count calendar,” describes how to create a stock count calendar.
I N V E N T O R Y C O N T R O L 7
Chapter 1: Overview
You can use Inventory Control to help manage your company’s inventoried items.
These can be any items needed for customer support, such as products or spare parts you sell; for business support activities, such as maintenance and repairs; or for use in creating your products, as in a manufacturing environment.
Many Inventory Control tasks help you create records for your items—how the items are to be tracked, what pricing should be used for the items that are sold, and so on. You also can use Inventory Control to enter and post certain types of
inventory transactions, to create service items, and to set up and perform stock counts.
This document includes the terms and concepts you’ll need to know to use Inventory Control.
The following information is discussed:
• Dependencies and relationships to other modules
• Item types
• Valuation methods
• Standard and extended pricing
• Multiple bins
• Stock count overview
Dependencies and relationships to other modules
When you use Inventory Control, you should be aware of how the module interacts with other modules.
Refer to the table for more information.
Item types
Item types describe the type of item or the status of the item. These types also determine which posting accounts are updated when items are entered on transactions. Refer to the Purchase Order Processing or Sales Order Processing documentation for information about which accounts are affected when posting
Module or series Affects inventory: Uses inventory info:
Sales Order Processing Sales transactions will decrease inventory amounts
Item records, quantities, and pricing information
Invoicing – Item records, quantities, and
pricing information Purchase Order Processing Purchase transactions will
increase inventory amounts
Item records, quantities, and vendor information. If you’re using the purchase order generator or landed costs, the details for each item-site combination are entered in Inventory Control.
Bill of Materials – Item records
General Ledger – Posting
transactions for each item type. Use the following table to decide which item type to assign to an item or item class.
Valuation methods
Valuation methods determine how the costs of inventory items are calculated.
While you can have different valuation methods for different items or companies, we recommend that you talk to your tax accountant before changing the valuation method you currently use. The following table describes the valuation methods available and explains how each is used.
Item type Description
Sales Inventory Quantities are tracked. You can enter both increase and decrease adjustments. Amounts posted to the Inventory and Inventory Offset accounts appear on the Distributions Breakdown Register.
Posting from Purchase Order Processing affects the Cash or Accounts Payables accounts. Posting from Sales Order Processing affects the Sales, Cash, Cost of Good Sold, or Accounts
Receivables accounts.
Discontinued Items are tracked the same as Sales Inventory items, selling Quantities On Hand. You can enter adjustments for the item, and can delete the item when the quantity reaches zero. Posting updates the Inventory and Inventory Offset accounts. Posting from Sales Order Processing affects the Sales, Cash, Cost of Good Sold, or Accounts Receivables accounts. If you don’t want to sell discontinued items, be sure that the Allow Sale of Discontinued Items option is unmarked in the Sales Order Processing Setup Options window.
Miscellaneous Charges Quantities and current costs aren’t tracked in Inventory.
Miscellaneous charges include costs such as freight expense. You can’t change this item type once it’s assigned. Posting updates the Sales and Cash accounts.
Kit Quantities aren’t tracked. Kits consist of one or more components, which can be services, sales inventory, miscellaneous charges, discontinued, or flat fee items. Based on the item type, posting updates the Inventory and Cost of Goods Sold accounts specified for each component. If you plan to create a phantom bill for use on a bill of materials, we recommend not assigning components to the Kit in Inventory. Posting from Sales Order Processing affects the Sales, Cash, Cost of Good Sold, or Accounts Receivables accounts.
Services Current costs, but not quantities, are tracked. You can sell these items individually or as part of a kit. Posting updates the Sales and Cash accounts.
Flat Fees Current costs, but not quantities, are tracked. You can sell these items individually or as part of a kit. Posting updates the Sales account.
Valuation method Description
FIFO perpetual Items purchased first are considered sold first (First In, First Out).
Detailed information about the cost of all items is maintained, and the inventory is valued at its actual cost. The current cost for items is the cost of the item the last time it was purchased.
LIFO perpetual Items purchased last are considered sold first (Last In, First Out).
Detailed information about the cost of all items is maintained, and the inventory is valued at its actual cost. The current cost for items is the cost of the item the last time it was received.
I N V E N T O R Y C O N T R O L 9 C H A P T E R 1 O V E R V I E W
Cost variances—which can result with any of the valuation methods—are tracked in the General Ledger using the Inventory Variance account.
Standard and extended pricing
You have the option of using standard or extended pricing. Both pricing systems allow you to set up different pricing structures—price levels in standard pricing, or price sheets and price books in extended pricing. You can create different pricing for different currencies and different units of measure. Either system can be used to create pricing structures with quantity breaks. However, you must choose one pricing system and use it exclusively; you can’t use both systems simultaneously.
Standard pricing
Standard pricing might be a better option for your company if any of the following conditions are true:
• You’re using Invoicing. (Extended pricing doesn’t work with Invoicing.)
• You want price lists to be updated automatically when the current cost or standard cost of an item changes.
• You have a fairly simple pricing structure, and don’t need additional tiers.
For more information about standard pricing structures, refer to Price methods on page 65 and Standard pricing price structures on page 67.
Extended pricing
Extended pricing might be a better option for your company if any of the following conditions are true.
• You want to use date-specific pricing.
• You want to create promotions for special pricing, such as value-off pricing or for “buy one, get one free” situations.
• You have a complex pricing structure: you want to use more tiers or you want to apply multiple promotions simultaneously.
Moving average perpetual The cost of items with the same item number is totaled and an average cost is assigned to the items. The average cost of an item is revalued throughout the period as you enter increase
transactions for items. The average cost also is used as the current cost. The formula is:
(Current units x current moving average cost) + (New units x purchase price) / (Current units + new units)
FIFO periodic Items purchased first are considered sold first (First In, First Out), and are valued at their standard cost. To update the standard cost, you can use the Inventory Year-End Closing window. At the end of the year, the standard cost can be adjusted to the current cost.
LIFO periodic Items purchased last are considered sold first (Last In, First Out), and are valued at their standard cost. To update the standard cost, you can use the Inventory Year-End Closing window. At the end of the year, the fixed cost can be adjusted to the current cost, or the cost of the item the last time it was received.
Valuation method Description
For more information about extended pricing, refer to Extended pricing terms and definitions on page 81 and How prices are calculated on page 82.
Multiple bins
Use multiple bins to add a layer to item quantity tracking for items with the Sales Inventory or Discontinued item type. Besides tracking items within inventory sites, with multiple bins you can track item quantities in bins that reside within each site.
Bin quantities are processed and displayed in the item’s base unit of measure.
You must register the multiple bins feature and enable it in Inventory Control before you can use it. Refer to Specifying preferences and default entries on page 15 for more information about enabling multiple bins.
Default bins for transaction types at each site can be identified. For example, a default bin could be created for sales order transactions at your warehouse site.
Default bins can also be identified for a particular item and transaction type at a site.
If you always use Bin A when selling a certain item from your main site, for example, you can set up Bin A as the default sales order bin for the item at the main site.
When you enter a transaction, the default bin for the transaction type for the item-site combination or the item-site is used automatically. In most cases, if there isn’t a default bin for the item-site combination or the site, you can enter a bin.
Refer to the table for more information about when default bins are suggested and whether you can change them.
For information about how multiple bins are used in each module, refer to the documentation for the module.
You can transfer items from one bin to another. You can also remove bin records from a site or an item-site combination. You can select a range of bins to remove, and you can select a range of sites and items from which to remove bins.
For more information about multiple bins, refer to the following topics:
• Preparing to use multiple bins on page 18
• How bins affect transactions on page 162
Stock count overview
To help you monitor your inventory and the accuracy of your inventory records, Module or series Default bin supplied? Can you change it?
Bill of Materials Yes No
Inventory Control No You must specify the bin when
you enter the transaction.
Invoicing You can’t use multiple bins if you’re using Invoicing.
Purchase Order Processing Yes Yes
Sales Order Processing Yes Yes
Field Services Series Yes Yes
Manufacturing Series Yes Yes
I N V E N T O R Y C O N T R O L 11 C H A P T E R 1 O V E R V I E W
counts and physical inventory counts. Cycle counting is the practice of having inventory personnel count items on an on-going basis. If you want inventory personnel to complete some counts every day or every week, you’ll probably want to use cycle counting. Physical inventory counts occur when all items are counted at the same time. Inventory Control’s stock count system includes both cycle counts and physical inventory counts.
With Inventory Control, you can specify items to be counted in a stock count schedule. After the count is complete, you can enter the results. The counted quantities are compared with inventory record quantities. You can use variance transactions—if needed—to correct discrepancies. Later, you can compare the accuracy of different stock counts with the Accuracy Comparison report. The information on that report can help you spot inventory trends, which can be helpful in determining business practices.
You can specify how frequently you want to count each item number at each site.
For example, you might want to count critical items every 30 days, and you might want to count relatively unimportant items—such as supplies—much less
frequently. You can specify a different count frequency—or “cycle”—for each item at each site.
Once you’ve specified a group of items with the same cycle frequency, Inventory Control divides the number of items to be counted over the cycle period. For example, if you have 100 item numbers to be counted every 10 days at a site, Inventory Control would schedule 10 items to be counted each day. This helps to minimize the impact of the stock counts on your inventory personnel.
Refer to these topics for more information about using stock counts and cycle counting.
• Chapter 8, “Stock count calendar,” explains how to create and modify a stock count calendar—the calendar the system will use to determine the days when a stock count might be done.
• Chapter 17, “Count intervals,” describes how you can specify a count interval for groups of items.
• Chapter 21, “Stock count schedules,” includes information about starting a stock count—specifying which item-site combinations should be included in the count, printing forms to record count information, and so on.
• Chapter 22, “Stock count processing,” contains information about entering the results of a stock count, working with default variance transactions, and generating the stock count accuracy report. Information about using the report also is included.
I N V E N T O R Y C O N T R O L 13
Chapter 2: Setup preparation
Inventory Control integrates with several other modules, so be sure you’ve completed the setup procedures for those modules before you begin setting up Inventory Control.
When you set up Inventory Control, you can open each setup window and enter information, or you can use the Setup Checklist window (Microsoft Dynamics GP menu >> Tools >> Setup >> Setup Checklist) to guide you through the setup process. See your System Setup Guide (Help >> Contents >> select Setting up the
When you set up Inventory Control, you can open each setup window and enter information, or you can use the Setup Checklist window (Microsoft Dynamics GP menu >> Tools >> Setup >> Setup Checklist) to guide you through the setup process. See your System Setup Guide (Help >> Contents >> select Setting up the