Hi, how do i treat inventory items with no price?
The situation is that suppliers provide trade deals such as buy 1 get 1 free. Within the Purchase Invoice, I enter it as Quantity: 1, Price : 0 and the system does not recognise it.
Also, how do I decrease the inventory amount when I give away free things on the Sales Invoice? I’ve just entered it similar to the Purchase Invoice but I realise the system doesnt recognise it.
This is a bug and will be fixed within an hour (I’m currently working on this actually)
A little bit of context:
Originally Manager has been programmed so it ignores line items with amounts 0.00. This has been working fine until we’ve added inventory and quantity columns. Now if you are using quantity column, you probably don’t want those line items to be ignored even if the price is set to 0.00 so it’s being corrected.
This has been now fixed in the latest version (14.2.35)
Great thanks! How would manager treat the COGS then? Is it applied as a weighted average?
Manager is using perpetual weighted average cost method. It means it re-calculates average cost per item after each purchase (or inventory write-on/write-off). Here is an example:
Jan. 1 Beg. inventory 5 units @ $500/unit
Jan. 5 Purchase 20 units @ $550/unit
Ave. cost = (2500 + 11000)/25 = $540
Jan. 9 Sales 21 units @ ave. cost of $540 = $11,340
Balance : 4 units @ $540 = 2160
Jan. 18 Purchase 6 units @ $600/unit
Jan. 25 Purchase 10 units @ $620/unit
Ave. cost = (2160 + 3600 + 6200)/20 = $598
Jan. 29 Sales 8 units @ ave. cost of $598 = $4784
Cost of goods sold on Jan. 29 = $4784