Inventory total cost issue

I decided to give manager cloud edition a go for the new year.

I set the starting balance for all raw materials, packaging materials and finished goods. When it comes to calculating total cost, manager takes my starting stock and squares it and then puts that as the total cost.

For the sample item in the picture the total cost should be 0.22 x 54590 = 12009.8 but instead it does 54590 x 54590.

Do I have to go in individually on all 300+ items and change the average cost? Which for some reason is the same as the starting balance.
This is how the data looks in Excel when I do the batch update and copy the information from Manger to Excel.

Thanks!

If you are moving from the desktop to cloud edition, you should not go through any of this. Simply make a backup of your business in the desktop edition and import it to the cloud edition. See https://www.manager.io/guides/8890. All historical transactions and current inventory will be transferred.

Starting balances are only for migrating to Manager from a different accounting program.

I did the set up on the desktop version but I never used it for issuing any invoices, or register receipts, statements etc. I did some for testing to see how well it would suit our business but I deleted all of that before I did the backup and imported it to the cloud version.

So for the new year I need to have all the starting balances etc for all the inventory items and finished goods as we just did the count.

OK. So here are some further considerations:

The total cost of the item shown (or any inventory item) is not quantity owned times the purchase price. Purchase price is a shortcut to streamline transaction entry. Total cost of an item is quantity owned times average cost. Your average cost is 12,009.80. The question is, how was that arrived at? Go to Settings > Starting Balances > Inventory on hand and click Edit for the item in question. Post a screen shot of what you see. I suspect you have put your total inventory item value in as the average cost.

If you insist on creating a new business and setting starting balances, you will need to set average costs for all items one way or another. You can do this individually or through Batch Update. But these numbers will not be the same as the starting balances. Starting balances are the closing balances from the previous accounting system. Average costs reflect your entire prior buying history.

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Indeed it takes Average cost x Quantity. When I make a batch update though, there is no way for me to adjust Average cost? I have to do it individually? Edit: Figured it out I think! I copied cost onto the “StartingCostBalance” column.

I’m trying to figure out why it put the Starting balance as Average cost.

So I did a batch update and copied the “Purchase price” to the “StartingBalanceCost” column and now it’s all good.

I think the problem was that when I did the original batch update and copied the data into excel I only saw “StartingBalance”, the “Cost” part was not there (due to column width) so I put the starting stock in that column, once I realized my mistake and put it back to 0 it still used the old entry as part of the “Average Cost” calculation.

I don’t know if that makes sense but that is the only explanation I can come up with. I hope it will still adjust average cost appropriately once I start doing the purchase orders with Manager.

Yes, there is.

Exactly. But the variable is not StartingCostBalance. It is StartingBalanceCost.

Because that is what you entered according to your screen shot.

This is only valid if every single unit of the inventory items in stock were purchased at the exact same cost and you never added any freight-in charges. That is an unlikely scenario.

It won’t. Manager will not adjust starting balance information based on what you enter later. Further, no adjustments to anything are ever made as the result of purchase orders. Those have no financial impact on any account. They are only a convenient way to enter orders so you can copy them efficiently to purchase invoices later. You need to sort out any problems with starting balances before you continue.