I sold some equipment (ie invoiced the client) before I actually bought the equipment (ie created the purchase invoice after sales invoice date).
I have this issue where I have a transaction called cost adjustment to recover from negative inventory - its not allocating the amount to the sales invoice from January. How do I fix this?
Manager processes/records transactions in date sequence and can’t retrospectively update prior entries.
Imagine that your sales invoice had been in the last accounting year, you wouldn’t want a current year transaction amending prior year balances after the year had been closed.
You could take up a Pro-forma invoice dated prior to the sale via a journal, Debiting the Inventory and Crediting Goods in Transit and when the actual invoice arrives post it to Goods in Transit - Then your sales would show correctly
I understand this part and agree with you 100%. However, I am not wanting to amend the sales invoice so nothing would actually change between one accounting year or another. All that has happened is I could supply a sales invoice today for three mouses and tomorrow I could create a purchase invoice for the aforementioned three mouses. All I want is for the 3 mouses in inventory transactions to be linked to the sales invoice and purchase invoice. This does not happen if I do sales invoice before purchase invoice - if I have negative inventory. This is not really an issue with amending the sales invoice, the program is not allocating the mouses to the sales invoice if there are no mouses in inventory.
I guess the fundamental accounting logic is that you can only sell what you have but increasingly with online businesses who only purchase stock (or arrange direct delivery) after they receive a sales order - so that logic is challenged
You wrote "All I want is . . inventory transactions to be linked to the sales invoice and purchase invoice. This does not happen if I do sales invoice before purchase invoice "
Does this linking between Sale/Purchase Invoices even occur in the conventional sense - Purchase 1st, Sell 2nd? (Purchased last month - Sold next month)
See previous topic -
@itmoto Thanks for linking me to this. This explains whats going. As Lubos said, the problem with invoicing the client before buying the goods means that Manager cannot determine what the cost of sales is so thats why there is an adjustment. Not sure why the adjustment cannot be linked to the original sales invoice!
I will see if I can jiggle the invoices around so that purchase invoice is dated before sales invoice to fix this issue as its very unusual for me to invoice the client first before buying the goods. This time round was different.
@Brucanna there is a link of a sorts, in that Manager shows an inventory transaction view. but there is no actual link to the actual invoice per se as the invoice doesn’t care when the products were bought and what they cost.
Lubos apparently implemented this cost adjustment to fix the issue of Manager not knowing what the purchase price was at the time of sale (if negative inventory). I am not sure why the cost adjustment cannot adjust the table row where the sales invoice is showing in the inventory transactions.
But because its very unlikely that this scenario will happen again, I will just change the dates of the invoices. not proper accounting, but I don’t get audited to that level, so who cares.
That’s the attitude!.
By shifting/altering the purchase invoice date only, creates the minimalist impact and gets the stock in ahead of the sale. Pushing the sale invoice date back can have side effects, especially with cash rather then credit sales. Internet sales (as an example) generally include payment with order, so if the sale invoice date is altered then “technically” the payment leg of the transaction becomes Customer Credits if one is pedantic rather then fluid with the processing.
The cost adjustment is an excellent feature as it accommodates differential transaction timing.
HI @lubos - are the changelogs listed here for fixing this issue in this topic
Also will this have fixed the issue of returning inventory - see this topic
Thanks
The latest version does handle negative inventory a bit differently. So you need to try the latest version to see what impact it has on this specific scenario. I wasn’t fixing this issue specifically but it might have been fixed as a side-effect.
Yes, the latest version is fixing the issue you have raised in that other topic.
Hi there, I’m new to manager and am currently inputting my purchase Invoices only and haven’t started to enter sales invoices. I see the “Cost adjustment to recover from negative inventory”. From reading the previous discussion I understand that this can be caused from selling an item from inventory before receiving the purchase invoice to enter the item. As I have not entered a sales invoice for any of the items I have entered from the purchase invoice, I do not understand why the Cost adjustment to recover from negative inventory is showing up. I have been using a manual method for accounting and am embarking on upgrading to a computer system. This forum is great, I have already learned a lot from searches. Thanks,
Have you put in Inventory opening balances, if yes, were any of them negative ?
Otherwise show a screenshot of where this is occurring
I put in Inventory opening as 0 as I started a new business in the last part of last year. I set the start date to the date my new company started and all inventory was at 0 at that time. I am entering invoices from vendors.
Also why is there an average cost and total cost. Should they be the same as cost?
Your first screen shot is not clear. What is it showing? Without seeing which tab is highlighted and headings, it’s impossible to know what you are showing.
Average cost is the average unit cost since inception, considering all purchases of an inventory item, which may have occurred at different individual costs, possibly even from different suppliers. Total cost is the product of average cost and quantity on hand.
You shouldn’t be entering 0 as the opening inventory.
You only enter opening inventory values if the quantity equals 1 or higher.
As 0 is less then 1, the system is seeing 0 as a negative value.
If you untick the Starting Balances box for the inventory items, then those messages should disappear
This issue seems to have been solved by unchecking the flat rate GST. Somehow it was all connected. Thanks again. Ps. I still have 0 inventory as opening inventory, and now all the numbers match.
