Inventory on hand cost calculation problem

@lubos there seems to be an issue with inventory cost calculation. ver 20.5.81

as you can see there is no qty available but still total costs are calculated. all of these inventory items involve production orders if it helps. the cost do not show on the Summary screen though.

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@sharpdrivetek, I moved your post to a new topic because it was not related to production order cost calculations. I cannot reproduce this with v20.5.82.

i have provided the relevant screenshot. obviously there is a bug with the inventory cost calculation irrespective of production orders.

this also affects the Inventory - cost account under Summary with the recently introduced change. unchecking the new feature shows the correct values in Summary but the issue in the Inventory Items tab remains.

I think the issue is related to multi-stage production process.

@sharpdrivetek do you have any inventory item which on production orders serve both purposes - input and also output item?

E.g. Pulp is converted to Paper and Paper is converted to Book. Paper (the middle item) would serve on production order both purposes (input / output).

@sharpdrivetek check the latest version (20.5.89) and go to Inventory Items tab.

If you have multi-stage production process, Manager will now check your inventory items whether production stage is set correctly for each item and if not, you will see alert like this:

When you click on the alert, you will see list of inventory items. Their current production stage and “required” production stage. You will need to edit inventory items where production stage is lower than required and set it to required or higher.

This would fix inventory cost issue. So I don’t think this is a bug, for multi-stage production, the correct production stage needs to be set so production orders are executed in the correct order and inventory cost can flow between them properly.

Manager doesn’t support circular production orders. You cannot have Item A which is used to produce Item B and then have another production order which is using Item B to produce Item A. If you enter production orders like this, Manager will forever complain about inventory items which need their production stage elevated because production stage of input items must be always lower than production stage of output items and circular production orders make this impossible.

@lubos the issue persists in version 20.5.89
i do not have any such production orders for the inventory items experiencing this issue. nor did i manually set any Production stage for the inventory items yet.

following are the screenshots for one of the inventory items.

in the above a Sales Invoice is not listed for Dec 2018.

above is the edit screen for Sales Invoice 19015. as you can see the amount listed in the earlier drill-down is different from the sales invoice.

above shows the edit screen for production order number 114

above is how the input item is listed in the Inventory Items tab.

above is the drill-down of the input item. the values are correct in this case.

also, below is a screenshot of the Inventory - cost account under Expenses displayed on the Summary screen before and after enabling image
before image
after image

@lubos i think i have found the issue. when i changed the Production stage of the output to a higher number, the Total cost is back to zero.
Manager had automatically assigned 1 as production stage for all the inventory items. should i manually edit all the inventory items now or will there be a fix for existing users?

like i had mentioned earlier in another topic i still do not find this intuitive to set the production stage at the inventory item level. in a business it is the responsibility of the production manager to decide the production stages and not the storekeeper. this would benefit in a multi-user environment when there are permissions involved. therefore, i still believe the Production stage should be a part of the Production Orders.

I’m reviewing how new general ledger deals with production orders and sales on the same day. It looks like production stage needs to be set for all inventory items if you use production orders for this reason.

@lubos please note that the above issue still persists.

also, regarding the above, i now understood that Manager only displays the average cost of the total inventory item sold to balance the Total cost figure. it is a little misleading since the sales total is different. maybe you can consider adding a column showing the actual sales value too.

okay i will Batch Update my inventory items.

Actually in the previous versions, the Total cost figure wasn’t even clickable. I want to improve the screen so it’s easier to see how Total cost ended up being calculated.

Keep in mind, sales figure can be misleading. You can sell 1,000 widgets but have only 500 on hand. Total cost will obviously deduct only 500. And another 500 will be deducted when more inventory is added (e.g. purchased or produced). So one sales invoice can produce more than one entry under Total cost column.

Check the latest version (20.5.90), it will show you under Inventory Items tab recommended production stage per item based on entered production orders.

Once correct production stage is set, then your inventory figures should be correct.

this is perfect. would it be too much to ask if there was a quick update button which would update the inventory items to their recommended production stage?

by the way i have found another issue.
irrespective of the production stage, when a sales invoice is issued at an earlier date than the production order, Manager does not list the sales transaction for the inventory item and the Total cost do not balance to zero.

Are you able to reproduce this issue in some test business? I can’t reproduce it.


Sales Invoice issue date is 27/05/2020 but because qty was produced on 28/05/2020, inventory cost by sales invoice removed on that day.

please see below. i also have Delivery Notes enabled and it has the same date as the sales invoice.


@lubos i think i missed to see it but the issue is not sales invoice issued at an earlier date.
the production order listed is showing a different date than the actual date which is evident from the second and third screenshots above. i am not sure what is causing this issue.

I can reproduce the issue if production order contains item which will be purchased at later date. Thinking of solution…

yes i can confirm that is the issue. the input item has a purchase invoice dated 23rd Dec.

@lubos i have found another issue related to the date and amounts calculated.

i have an inventory item with few qty on hand. but the total cost shown is zero.

when i drill-down on the total cost value, i found that Manager shows values which are not the same as in the transaction. also the date of the transaction is displayed incorrectly.

the amount displayed till the transaction on 12-Jul-18 is correct. the problem starts with the credit note transactions which has a date 10-Oct-18 but erroneously listed as 27-Oct-18. the associated delivery note for the credit note is also dated 10-Oct-18.

as you can see the amounts and date listed in the drill-down differs from the credit note.

I’m working on better presentation when clicking on balance in Total cost column. This should bring more clarity why amounts and dates are different.

I agree.

  • I can see Manager being useful for stock level reporting. Both in stock, sold, on production order or purchase order with drill down for each of these.

  • I can see value in Manager summarising historical costing for prior supplies. However actual new sales costing depending on prior data as well as adjustments anticipated in new supplies/ production runs. It is possible if Manager assumes a production order it can provide more costing data but I’m unsure of the validity of any such assumptions. I’m also unsure about the value in exposing this internal calculation order to the user.

  • Actual production scheduling depends on input and output stock levels, sales orders delivery dates and penalties, production capacity/ resource loading (both under and over loaded), batch startup costs, lead time/ production time, risk management of all theses issues. Dedicated software is often used to assist with this but it is ultimately controlled by a management team.