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Evo-ERP and DBA Classic >> Accounting >> Avg Cost
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Message started by Juan on 01/06/10 at 08:27:28

Title: Avg Cost
Post by Juan on 01/06/10 at 08:27:28

We made the Avg Cost and last cost of a group of items zero. We run the re-calculate book value report (UT-K-G) The total reduction was close to 12M but we don't see where does GL gets affected by these changes. Shouldn't there be a big reduction in the inventory value in GL? We used IN-K to make the changes to the Avg/Last Cost.
Thx
Juan

Title: Re: Avg Cost
Post by GasGiant on 01/06/10 at 08:45:52

No transaction, therefore no change in GL. UT-K-G states on the opening screen "No GL postings will be made here, but a report listing all changes made will be printed."

You need to make an adjusting entry to inventory value on the accounting side.

Title: Re: Avg Cost
Post by Juan on 01/06/10 at 09:25:35

Thank you for the explanation, but the message we get doesn’t say that. This is what we get
“The current book value of this part (dollar value) is (dollar value) more than the value if calculated by multiplying the revisited average cost times current UOH. The book value of this part will not be adjusted here for this difference, use “The enter inventory adjustments” (and/or edit FIFO/LIFO buckets) menu selections if you wish to adjust the cost basis”
Thx
Juan

Title: Re: Avg Cost
Post by GasGiant on 01/06/10 at 10:20:49

That is the message you get in IN-K, not in UT-K-G. UT-K-G has the message I stated above. The IN-K message is just telling you that Book Value will not be adjusted. You need to run UT-K-G to update the book value. However, even updating the Book Value only changes the values on the Inventory side of things, NOT the accounting side. Only transactions affect the GL.

Title: Re: Avg Cost
Post by cathyh on 01/06/10 at 11:27:32

And that is why you should adjust cost using IN-C Inventory Adjustments (adjust out at old cost, adjust in at new) so that the GL will be affected.
We have really learned our lesson here with trying to use IN-K to adjust average cost (with some pretty large mistakes that had to be resolved with a journal entry). We don't do that anymore.

Title: Re: Avg Cost
Post by GasGiant on 01/06/10 at 12:00:33

They are for different purposes. When we went through the process Juan is talking about we were moving hundreds of item to zero value and IN-K was the most efficient manner. You just have to remember to make a post to your inventory ledger when you are done and have run UT-K-G.

I can't even imagine the number of miskey errors that would creep in if you tried to zero out 300 parts using IN-C :o

Title: Re: Avg Cost
Post by Juan on 01/06/10 at 12:06:11

Colin, thx I see it now.
Cathy, If we had used IN-C we need it to specify location (we have stock in several location) also the were no changes to the O/H.
Thx
Juan

Title: Re: Avg Cost
Post by cathyh on 01/06/10 at 12:46:52

well, yeah, 300 parts no way. Even IN-K is painful with that many changes!
I am fortunate that we have never had to do more than a handful at a time and we have one location, so IN-C works for us.
But for multiple locations and/or many parts, IN-K with journal entry sounds like a plan!