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Introduction
Inventory journals are used for posting physical inventory transactions including posting issues and receipts, inventory movements, creating bills of material, and reconciliation of physical inventory. This chapter explains inventory journals by reviewing the initial setup in addition to each journal.
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2. In the Journal names, inventory form that opens, create a new record and type the journal name and its description. 3. Select the Journal type that determines what the journal is used for. 4. Select a Voucher series from the list.
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There are no set guidelines for selecting dimensions. However,, we recommend that you use only the number of dimensions that will actually be used for each product. If some products are tracked and other products are not, create several dimension groups. Carefully consider how inventory should function before you set up inventory dimensions and dimension groups.
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Posting
When you record inventory transactions. For example, in an inventory adjustment journal, you can generate the transactions for inventory profits and losses. Use the Posting form to set up ledger account numbers for the automatic ledger transactions that are generated for receipt and for issue transactions in the inventory.
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Each tab contains several account types, and for each account type, you must specify which account in your own chart of accounts that you want to use. If you have created an item group in the Item groups form with corresponding posting, that posting will automatically appear in the form, with the item group as a reference. You can use either posting profiles or posting definitions to set up the account numbers for offset accounts. Each posting profile is associated with only one offset account. Posting definitions can be associated with multiple offset accounts.
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When a positive quantity is entered in the journals, a receipt and gain is posted. However, when a negative quantity is entered on a journal line, an issue and loss is posted.
Movement Journal
The Movement journal can be used to bring in opening inventory balances during system setup, and offset these adjustments to specific ledger accounts. Other examples of how the movement journal can be used include the following: To charge an item to a different department, for example, from Prototyping to Engineering. To remove items from inventory to take to a sales show. The inventory value must be reduced and should be considered as an expense from the Sales Department.
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Challenge Yourself!
1. Create a Movement journal. 2. Pick the items. 3. Post from the Journal header form.
Step by Step
1. Open Inventory and warehouse management > Journals > Item transactions > Movement. 2. Click New. 3. Select IMov in the Name field and then click Lines. 4. Click the Item number arrow and then select 1701. 5. Confirm that the Warehouse is 21. 6. In the Quantity field, type "-1". 7. In the Offset account field, type "540100". 8. Click Inventory > Pick and then click Add picking list update. 9. Click Register all, and then close the Pick form. 10. Click New in the Journal lines form to enter a new line. 11. Click the Item number arrow and then select 1706. 12. Confirm that the Warehouse is 21. 13. In the Quantity field, type "-1". 14. In the Offset account field, type "540100". 15. Click Inventory > Pick and then click Add picking list update.
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Challenge Yourself!
1. Create an Inventory adjustment journal. 2. Post the journal.
Step by Step
1. Click Inventory and warehouse management > Journals > Item transactions > Inventory adjustment. 2. Create a new journal by clicking New and select IPL in the Name field. 3. Click Create new. A journal is created and the Journal lines form is automatically opened. 4. Select Item 1163 in the Item number field. 5. Confirm that the Warehouse is 11. 6. In the Quantity field, type "-10". 7. Click Post to post the journal, and then click OK. 8. Click Close to close the Infolog. 9. Close all the forms.
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Transfer Journals
Inventory transfers between stocking locations can be recorded in an inventory transfer journal. Each transfer minimally identifies an item, quantity, and the old and new stocking locations. An inventory transfer journal also supports the transfer of one variant of an item to another, in addition to transferring one batch number to another batch number, much as if you would transfer inventory from one warehouse to another warehouse. Inventory transfers reflect the immediate movement of material, without a requirement for tracking in transit inventory. For example, a transfer journal can be used to move material between two adjacent warehouses. Transfer orders should be used when in transit inventory must be tracked. In addition, the planned transfers between locations in a company can be modeled with planned transfer orders, whereas a transfer journal typically reflects an unplanned transfer.
The issue and receipt transfer journals use different lot IDs.
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Challenge Yourself!
1. Create a Transfer journal. 2. Transfer the batch number for item 1706.
Step by Step
1. Open Inventory and warehouse management > Journals > Item transactions > Transfer. 2. Click Create new. 3. Click the Item number arrow and then select 1706. 4. In the From warehouse field, type "21". 5. In the To warehouse field, type "21". 6. Click the From batch number arrow and then select 000009. 7. Click the To batch number arrow and then select 000008. 8. In the Quantity field, type "-1".
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Procedure: Generate BOM Journal and Lines from the Released Products Details Form
You can also generate BOM journal and lines if a product that is associated with a BOM is reported as finished directly from the Released Items list page. 1. Open Product information management > Common > Products > Released products. 2. Select a product that is associated with a BOM. 3. Click the Engineer tab > Report as finished 4. Enter any dimensions and the quantity to be reported as finished. 5. Click OK. 6. Open Inventory and warehouse management > Journals > Item transactions > Bills of materials and you can verify the journal for the BOM.
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Challenge Yourself!
1. Report the BOM as finished. 2. Remove the grill.
Step by Step
1. Open Inventory and warehouse management > Journals > Item transactions > Bills of materials. 2. Click Create new. 3. In the Journal lines form click BOM > Report as finished. 4. In the Report as finished form, click Select and then select Item number 1102. 5. Click OK. 6. In the Site field, type "1", and in the Warehouse field, type "11". 7. In the Quantity field, change the value to "4". 8. Clear the Post now check box. 9. Click OK and then close the Infolog. 10. In the Journal lines form, click the component (5001 Grill), and then click Delete. 11. Click Yes to confirm deletion. 12. Click Post. 13. Click OK. 14. Click Close to close the Infolog. 15. Close all the forms.
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Counting Journals
The Counting journal lets you calculate the current on-hand inventory level that is recorded for a group of items, and then post the actual physical count to make the adjustments necessary to reconcile their differences.
The Contoso Company's Warehouse Manager has determined which items must be cycle counted, and when. For example, all items that have a value greater than $1,000 U.S. dollars (USD) are cycle counted monthly; items with a value between 500 and 1000 USD are cycle counted every two months; and items with a value between 250 and 500 USD are cycle counted quarterly. Items with a value lower than 250 USD are not cycle counted, but only inventoried one time per year during year-end inventory. The Contoso Company uses the Cycle Counting journal to support this process. In comparison, at year-end, the warehouse shuts down for three days for tag counting. During this process, the whole team counts every item in the warehouse by using the Tag counting journal.
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The warehouse items will be used to assign a specific counting group to each variant. Therefore, the counting journal will provide one request for counting each combination instead of a global request for all sizes and colors together.
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Counting Groups
Counting groups lets you create logical groupings of items, depending on how you want to count them. Typically, logical groups are based on item value, warehouse section, ABC code, inventory turnover, and similar factors.
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Items
Expired batches
Inventory and warehouse management > Journals > Item counting > Counting > Create new > Journal lines, Inventory In the Released Products form, you can determine whether an item is counted by clicking Setup > Warehouse items. When there are transactions for an item number in an Inventory journal, the Counting started field is selected.
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When the count is complete, you must enter what was counted into the system.
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Challenge Yourself!
1. Create a new Counting group. 2. Assign the counting group to Item number 10000. 3. Create a new counting journal with the results.
Step by Step
1. Open Inventory management > Setup > Inventory > Counting groups. 2. Click New to create a new group. 3. In the Counting group field, type "40". 4. In the Name field, type "LCD Monitor1000". 5. Click the Counting code arrow and then select Period. 6. In the Counting period field, type "7". 7. Save the record by clicking Close. 8. Open Product information management > Common > Released products. 9. Select Item number 10000 and then click Edit in the Maintain group. 10. In the Manage inventory FastTab, select 40 from the Counting group field.
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Each item number has its own stack of tags with its own number sequence to make sure that a tag is only used one time and that all tags are used. Therefore, a tag can have one of three status values: Used: item number counted for this tag Voided: item number voided for this tag Missing: item number missing for this tag
This makes sure that the company is always current with their tags and can account for them. Moreover, because the tag counting process is usually tightly linked to the financial auditor's checks and reviews, each tag must have a status to prove that all generated tags are accounted for, retrieved, and voided if it is necessary. Missing tags are not usually accepted. When all lots are counted, the used tags should be registered in the Tag counting journal. Select Inventory and warehouse management > Journals > Item counting > Tag counting. The Tag counting journal posts the entries in a counting journal, from which any differences between expected and physical on-hand inventory are posted.
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Inventory Blocking
Inventory blocking is part of the quality inspection process. During the quality inspection, items are automatically blocked from consumption or issue. Also, you can manually block items that you want to prevent from being issued or consumed. You can block inventory items in three ways: Manually By creating a quality order By using a process that generates a quality order
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2. 3. 4. 5.
Click New to create a new blocking transaction. In the Item number field, select the item that you want to block. In the Quantity field, enter the quantity that you want to block. If you want to include the blocked quantity in planning activities as an expected on-hand quantity, select the Expected receipts check box.
NOTE: If the item that you want to block has a specific serial number as indicated on the Inventory dimensions FastTab, you can only block a quantity of one. To manually unblock inventory items, follow these steps: 1. Click Inventory and warehouse management > Periodic > Inventory blocking. 2. Select the blocking transaction for the inventory items that you want to unblock and then click Delete.
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10 percent of the purchase order quantity of the item is sent to inspection. The full quantity of the purchase order line is blocked.
With the Full blocking check box selected, the item sampling setup indicates that the full quantity of the purchase order line must be blocked during inspection regardless of the quantity that is sent for inspection.
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To set up a sampling plan, follow these steps: 1. Click Inventory and warehouse management > Setup > Quality control > Item sampling. 2. Click New to create a new sampling plan and fill in information about the sampling plan. 3. Select the Full blocking check box if you want to block the full quantity of items in transactions that are covered by the sampling plan. Consider expected receipts for manually blocked items 1. Click Inventory and warehouse management > Periodic > Inventory blocking. 2. Click New to create a new blocking transaction, complete the information about the transaction, and select the Expected receipts check box.
Summary
Inventory Journals reviewed how inventory journals are used. This included the following: Transaction journals that are used to move inventory, record profit and loss, move items between different dimensions, and report as finished BOM transactions. The use of counting and tag counting journals for the reconciliation of physical inventory.
Using these features help handle and manage inventory. In addition these features help you keep track of and control differences between system-registered inventory and actual inventory that is physically present in the company.
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2. Where are inventory journals set up? ( ) Inventory and warehouse management > Setup > Posting > Posting, Inventory tab ( ) Inventory and warehouse management > Setup > Parameters ( ) Inventory and warehouse management > Setup > Journals > Journal names, Inventory ( ) Inventory and warehouse management > Setup > Journals > Journal names, warehouse management 3. What is the main difference between an Inventory adjustment and a Movement journal?
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5. Warehouse items let you do which of the following? ( ) Always have the item available on-hand ( ) Make the item default for counting journal ( ) Record multiple item dimension configurations for your items for each warehouse ( ) Lock the items for any updates
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Solutions
Test Your Knowledge
1. What are inventory journals used for? MODEL ANSWER: For posting physical and financial inventory. 2. Where are inventory journals set up? () Inventory and warehouse management > Setup > Posting > Posting, Inventory tab ( ) Inventory and warehouse management > Setup > Parameters ( ) Inventory and warehouse management > Setup > Journals > Journal names, Inventory ( ) Inventory and warehouse management > Setup > Journals > Journal names, warehouse management 3. What is the main difference between an Inventory adjustment and a Movement journal? MODEL ANSWER: You can select the offsetting general ledger account in the Movement journal. 4. What two inventory transactions are created for each journal line when you post a Transfer journal? MODEL ANSWER: Inventory receipt and issue. 5. Warehouse items let you do which of the following? ( ) Always have the item available on-hand ( ) Make the item default for counting journal () Record multiple item dimension configurations for your items for each warehouse ( ) Lock the items for any updates
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