I am using manager for a services company that purchases inventory for use in the process of service delivery. Usually the cost of this is included in the sales invoice but we use another system for tracking the stock issuance and movements. There are monthly stock counts to verify stock levels and records for each issuance.
I have the values of the items based on the purchase prices.
I would like to see Inventory on hand based on a stock take done at a certain point in time.
Is there any way that manager can take this input ?
Keep things simple and use Non-inventory Items, create an ordinary balance sheet account and record periodic stock takes using Journal Entries.
A bit more hands-on approach is to use Non-inventory Items for sales and purchase transactions and keep Inventory Items for the sole purpose of recording stock write-ons/write-offs. This however, will duplicate the items as each physical item will have to be both in Inventory Items as well as in Non-inventory Items. Also, you will have to either reverse the previous entry or enter the variances.
Alternatively, you can simply use Inventory Items as usual and adjust the variances periodically using write-offs/write-ons. You have the choice of either to post the variance in a single entry or fully write-off the entire old stock and write-on the new stock take values.
You can refer to the following guides for more details:
There is another option to consider, @kendirangu. Ask yourself whether this is truly inventory, that is, goods held for sale. Or could you treat such items as billable expenses? The answer will depend on several factors, including:
Do you keep items on hand on a regular basis that you are willing to sell to multiple customers? Or are you purchasing things only for specific jobs that are shortly thereafter invoiced to the customer?
Do you attempt to maintain some minimum stock level?
What do you do if your stock take shows no units of some item on hand? Do you immediately order more? Or do you wait until you need it for a job?
Is inventory on hand taxed in your jurisdiction?
Is any form of consumption/sales/value-added tax mandatorily assessed against the end customer? Or could you satisfy local requirements by paying said tax yourself as the end user?
Also consider whether the items can be treated as consumable supplies.
Let me give you a couple examples.
A self-employed repair technician keeps no inventory, but has accounts with several local suppliers. When a customer needs an air conditioner fixed, the technician charges labor by the hour and obtains any necessary repair parts from a local distributor. The parts are treated as billable expenses. The technician pays sales tax on the purchase; because he is the one who installs the parts, local tax law considers him the end user, so he does not have to charge sales tax to the customer. He invoices billable time and billable expenses together.
A carpenter buys nails in 10 kg cartons. He uses them rapidly, so he treats them as consumable supplies and records their purchase as deductible expenses, not as inventory. When he opens his last carton, he purchases more. It would simply be impractical to count nails expended on framing a house. He recovers the cost of nails as part of his pricing formula.