Non-serialized Inventory
Non-serialized inventory items are small parts that are generally indistinguishable
from one another. Items received from different vendors
are assumed to be interchangeable for filling any inventory part request.
Non-serialized items can be sold and tracked in fractional quantities
up to the nearest millionth of a part (i.e.: 43.3082 widgets). Note, however,
that while you can use any vendor's product for a given job, the cost
of these items may vary depending on the item's vendor.
Because non-serialized items are interchangeable, ServiceCEO supports
several costing models for estimating the cost of a given item when it
is sold. You can define the default method for each item.
Average
On Hand This is the costing model supported by QuickBooks. If
50 items are in stock, with a total value of $500, and 10 items are sold,
then the cost of each item will be $10 and the value of the entire stock
will be decreased to $400 (because $50 divided by $500 = $10).
Last
Purchase Price Each items cost is set to the unit-cost of the
last item of this Master Product that was entered on a Purchase
Order (PO) or manually entered into the system. If
no items of the given Master Product type are on a PO or manually entered,
the cost reverts to the one entered as a default in the Master Product
List.
Exact
The (LIFO)
or first-in-last-out (FIFO)
methods are used to determine which cost to assign to each item sold.
Last-in-first-out
(LIFO) The item used to fulfill the
job will be the item that was most recently received. For example, if
you have 50 items in stock, the LIFO method would use the item that has
been is stock the shortest amount of time (i.e., item number 50).
First-in-first-out
(FIFO) The item used will be the oldest item in the system. For
example, if you have 50 items in stock, the FIFO method would use the
item that has been in stock the longest (i.e., item number 1).
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Caution:
Depending on when you assign items to a job or invoice, the LIFO/FIFO behavior
may be different than you expect. The charge for a requested item is determined
at the time the item is assigned to the job or invoice (and thus pulled
from the general stock). Thus, the LIFO/FIFO method is applied when the
item is assigned, not when the job is performed or completed. Because
you can assign an item to a job or invoice days or weeks before the job
is actually completed, the flow of items may be difficult to follow. |
See the Item
Costing section for details and examples about these costing methods.
See Also: Adding Master Products with Inventory
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