You use this program to define conversion factors for stocked items where the unit of measure in which the item is stocked is not the same as the unit of measure in which the item is costed.
This is particularly useful for large merchandise quantities, where each individual item has a low cost factor. For example: If your stocking unit of measure for pencils is each (EA) and the cost per EA is 0.01, you can apply a costing unit of measure of 10.00 per thousand (THO).
| Field | Description |
|---|---|
| New | Select this icon to add a new unit of measure conversion factor. |
| Delete | Select this icon to delete unit of measure conversion factor currently displayed. |
| Save | Select this to save the details you entered or changed. |
| Stock uom | Indicate the unit of measure in which the item is stocked. |
| Cost uom |
Indicate the unit of measure in which the item is costed. |
| Field | Description |
|---|---|
| Stock uom | This indicates the stocking unit of measure you selected. |
| Cost uom |
This indicates the cost unit of measure you selected. |
| Conversion factor | A conversion factor must be entered to indicate the relationship between the cost unit of measure and the stocking unit of measure. |
| Uom method | |
| Multiply | Select this to multiply the cost unit of measure by the factor entered at the Rate field. This converts the stocking unit of measure to the cost unit of measure. |
| Divide | Select this to divide the cost unit of measure by the factor entered at theRate field. This converts the costing unit of measure to the stocking unit of measure. |
| Rate | Indicate the rate that must applied to the cost and stocking units of measure. |
| Uom conversion | This displays the conversion from one unit of the stocking unit of measure converted to the costing unit measure according to the entries you made. |
Changing the cost unit of measure affects your Inventory valuation for those units of measure defined against stock items.
The Inventory Valuation report uses the cost defined against each stock item in each warehouse and converts this cost using the current cost and the current value of the factor. Therefore changing only the factor affects the report, but not the General Ledger (no journal entries are created).
For example, assume you have the following:
Stock item A111 with Cost unit of measure defined as Box
One Box = 100 Each.
One Box costs 200.00
You have 100 Each on hand.
The Inventory Valuation report calculates this as: 100 Each / 100 per Box = 1 Box
1 Box at 200.00 per box = 200.00 (so value of inventory is 200.00)
You now change the Rate for Box to be: 1 Box = 90 Each
The Inventory Valuation report calculates this as: 100 Each / 90 per Box = 1.11 Boxes
Assuming the current cost (i.e. 200.00) also applies to the new factor:
1.11 Boxes at 200.00 per box = 1.11 * 200.00 = 222.00 (so value of inventory is now 222.00).
No General Ledger journal is created for the difference between the initial valuation of 200.00 and the new valuation of 222.00. This means that the Inventory Valuation report will not balance to your General Ledger control account for stock item A111.
Before changing the cost unit of measure:
- Identify each stock item which uses that cost unit of measure.
- For all items identified, identify those with a non zero stock on hand.
- Check the current cost and determine whether that cost is also appropriate to the new factor.
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If the current cost must still be applied to the new factor, then:
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Use the Inventory Movements program to adjust the stock on hand to zero for all the items you identified.
This creates an adjustment journal for the General Ledger.
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Use the Browse on Cost Unit of Measure program to change the cost unit of measure RATE as required.
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Use the Inventory Movements program to adjust the stock back into the warehouse(s).
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If the current cost no longer applies to the new factor, then:
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Use the Inventory Movements program to adjust the stock on hand to zero for all the items you identified.
This creates an adjustment journal for the General Ledger.
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Use the Browse on Cost Unit of Measure program to change the cost unit of measure RATE as required.
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Use the Cost Change option of the Inventory Movements program to change the current cost of the items.
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Use the Inventory Movements program to adjust the stock back into the warehouse(s).
This creates an adjustment journal for the General Ledger.
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Inserting Application Help
You would typically follow this procedure to display help for the current program in a customized pane that can be pinned to the program window.
Information includes step-by-step instructions for the various functions available within the program, including a brief overview of what the program does, what setup options are required and how to personalize the program.
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Open the program for which you want to insert application help into a customized pane.
This functionality is only available for a program that has panes.
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Right-click any form field.
You can also click the triangle menu icon that appears in the title area of a pane.
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Select Insert Application Help from the context-sensitive menu.
The application help appears in a pane within your program. You can reposition the pane using the docking stickers or pin it to the program window.
Removing the Application Help pane
If you no longer want to display application help in a pane for your current program, you can simply remove it.
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Select the Close icon in the right-hand corner of the application help pane.
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Confirm that you want to delete the pane.