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Inventory method

  • 7 January 2021
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Hi 

May i know how many inventory method in acumatica system? 

As i know is FIFO rules, beside of this ,anything else rule?

 

Hope to hear from you soon

Thank you

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Best answer by meganfriesen37 8 January 2021, 00:02

Issue Methods available in Inventory Management

  • FIFO: Lot/serial numbers are picked for issue by receipt date (oldest first).
  • LIFO: Lot/serial numbers are picked for issue by receipt date (newest first).
  • Sequential: Lot/serial numbers are picked in alphabetic order.
  • Expiration: Lot/serial numbers are picked by expiration date (faster-expiring first).

Valuation Methods available in Inventory Management:

(see here for more detail: https://help-2020r2.acumatica.com/(W(13))/Help?ScreenId=ShowWiki&pageid=d2036919-67cb-44ca-ab1d-c9d92ed52af7)

  • Average: The entire quantity of the item on hand is valued with the same cost, which is the total cost of all quantities of the items at the warehouses divided by the total quantity. No distinction is made regarding whether a particular unit was purchased cheaply or expensively; all are valued equally. This is a moving average cost: each receipt adds to total cost and total quantity, causing average cost to be recalculated.
  • FIFO (First In, First Out): Each receipt creates a separate cost layer. Stock issue takes the cost from cost layers, starting from the oldest one; when the first cost layer is depleted, the second oldest layer is used, and so on until all issued quantity is costed.
  • Standard: The entire on-hand quantity of the item is valued with the same cost. Unlike average cost, standard cost is not built by actual receipts; it is defined by the product manager (from analysis of production, storage, handling costs, and the like). Standard cost is reviewed regularly through standard cost revaluation.
  • Specific: Each piece of the stock item has its own individual cost, which is defined by its purchase price. This valuation method is used for items with lot or serial numbers. The lot/serial number identifies the product piece and its cost layer.
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3 replies

Issue Methods available in Inventory Management

  • FIFO: Lot/serial numbers are picked for issue by receipt date (oldest first).
  • LIFO: Lot/serial numbers are picked for issue by receipt date (newest first).
  • Sequential: Lot/serial numbers are picked in alphabetic order.
  • Expiration: Lot/serial numbers are picked by expiration date (faster-expiring first).

Valuation Methods available in Inventory Management:

(see here for more detail: https://help-2020r2.acumatica.com/(W(13))/Help?ScreenId=ShowWiki&pageid=d2036919-67cb-44ca-ab1d-c9d92ed52af7)

  • Average: The entire quantity of the item on hand is valued with the same cost, which is the total cost of all quantities of the items at the warehouses divided by the total quantity. No distinction is made regarding whether a particular unit was purchased cheaply or expensively; all are valued equally. This is a moving average cost: each receipt adds to total cost and total quantity, causing average cost to be recalculated.
  • FIFO (First In, First Out): Each receipt creates a separate cost layer. Stock issue takes the cost from cost layers, starting from the oldest one; when the first cost layer is depleted, the second oldest layer is used, and so on until all issued quantity is costed.
  • Standard: The entire on-hand quantity of the item is valued with the same cost. Unlike average cost, standard cost is not built by actual receipts; it is defined by the product manager (from analysis of production, storage, handling costs, and the like). Standard cost is reviewed regularly through standard cost revaluation.
  • Specific: Each piece of the stock item has its own individual cost, which is defined by its purchase price. This valuation method is used for items with lot or serial numbers. The lot/serial number identifies the product piece and its cost layer.
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Hi Meganfriesen , 

 

Thank you very much for you reply!! it is very helpful for me

There are some question need to consult you

  1. Issue method in inventory management - If currently we are using FIFO , Not sure if we can change to EXPIRATION , Is there any impact in inventory data? if yes, what is the impact?
  2. Valuation method : May i know where we can check what method that we are using in my system right now?
  3. Valuation method and issued method is related each other ?
  4. Valuation method- Specific : does it mean in the inventory valuation , one part can be different cost in the valuation report?

Hope to hear from you soon

Erin,

1 - I don’t see anything in the documentation that would prevent you from changing your issue method, but I could be mistaken.  Whatever Valuation rule you would have on that item would still apply.

2 - Valuation Method can be different on different inventory items.  The valuation method can be inherited from the Inventory Item Class or can be assigned to a unique item.  You can view the valuation method on the Stock Items form for each item.

3 - The Issue Method is specifically used if you are using Lot/Serial Tracking in Acumatica (https://help-2020r2.acumatica.com/(W(16))/Help?ScreenId=ShowWiki&pageid=7d0568cc-3a1a-4e9c-a7ea-9df31601d445).  This is linked to the “Lot/Serial Class” that is assigned to the item.

4 - The Specific valuation method is used for serialized items (those with lot or serial numbers). With this method, the unit cost for each item is defined by the unit’s purchase price. The unit cost assigned to the item on its receipt will remain the same until the item is issued, used as a component, or sold. (see here for more info & an example of how this works: https://help-2020r2.acumatica.com/(W(14))/Help?ScreenId=ShowWiki&pageid=d2036919-67cb-44ca-ab1d-c9d92ed52af7)

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