Inbound/Outbound Inventory Movements and Inventory Adjustments (Average Cost)

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Overview

Inbound and Outbound Inventory Movements are used to record the following:

Inventory Movement Use Case	Typically Used Type
To record opening balances.	Accounting
To fix stock levels after cycle counts.	Accounting
To fix stock levels after an inventory reconciliation to the GL.	Accounting
To update inventory balances for a customer return.	Accounting
To record warehouse transfers.	Inventory Transfer

An Inbound Inventory Movement will increase the quantity available on the Inventory Quantity Available record. With the incorporation of Weighted-Average Costing, all inbound inventory movements will trigger a recalculation of the weighted-average unit cost. (See Inventory Valuation - Weighted-Average Cost for more information)

An Outbound Inventory Movement will decrease the quantity available on the inventory quantity available record. Outbound inventory movements do not trigger a recalculation of the weighted-average unit cost; however, Outbound Inventory Movements do populate the Unit Cost Field with the weighted-average cost from the Inventory Cost Object. (See Inventory Valuation - Weighted-Average Cost for more information)

Use this article to learn more about the following:

Accounting Entries by Movement Type
Reconcile Physical Product Counts to Inventory Balances (Cycle Counts)
Process Extended Returns to a Manufacturer (RMAs)

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Accounting Entries by Movement Type

Inventory movements with a type of Non-Accounting and Inventory Transfer do not record an entry into the general ledger. These types of movements only affect inventory balance.

Note: A warehouse transfer (Type = Inventory Transfer) is the only non-accounting Inventory Movement that can be used by customers using Accounting Seed’s Weighted-Average Cost Inventory feature. Inventory Movements (“IIM” and “OIM”) with type = non-accounting will not be allowed when using the Weighted-Average Cost Inventory feature.

Inventory movements with a type of Accounting do record entries to the General Ledger (GL):

Inbound Inventory Movement

Debit GL Account

Defaults to the Inventory GL Account listed on the product unless specifically overwritten in this screen for an Inbound Inventory Movement.

Credit GL Account

This field must be specifically set in this screen for the Inbound Inventory Movement.

Outbound Inventory Movement

Debit GL Account

This field must be specifically set in this screen for the Outbound Inventory Movement.

Credit GL Account

Defaults to the Inventory GL Account listed on the product unless specifically overwritten in this screen for an Outbound Inventory Movement.

Important: A user-defined posting status should not be created or assigned as a default status on any Inventory Movement objects. This will interfere with the posting of these records.

If the Auto Post Setting is set to "On" in the Post Settings screen, the following fields on unposted Accounting Inbound Inventory Movements (IIMs) and unposted Outbound Inventory Movements (OIMs) can be edited:

Project
Project Task
Credit GL Account
Debit GL Account
GL Account Variable 1-4.

These fields cannot be edited if the IIM or OIM record has been posted.

Note: If you need to change fields such as the Quantity and/or Unit Cost, the IIM or OIM record will need to be deleted and a new one created.

Note: When Inventory Movements are deleted, they are automatically deleted from the Recycle Bin. This is built-in as a safeguard to prevent users from un-deleting files that were used in the recalculation of weighted-average cost.

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Reconcile Physical Product Counts to Inventory Balances (Cycle Counts)

Accounting Seed is a perpetual inventory system. This means that there is no need for a physical inventory of your warehouse to update your accounting records. However, it is prudent to periodically audit your physical inventory balances and compare them to actual inventory balances recorded in Accounting Seed to ensure any product has not been damaged, stolen or incorrectly processed.

Cycle count adjustments are processed as inbound or outbound inventory movements on the appropriate Inventory Quantity Available record. Users may want to note the adjustment with a cycle count date. An Inventory Quantity Available report can easily be exported to Excel to create cycle count sheets.

To adjust an Inventory Quantity Available balance up, use the Inbound Inventory Movement object.
To adjust an Inventory Quantity Available balance down, use the Outbound Inventory Movement object.

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Process Extended Returns to a manufacturer (RMAs)

Please see the Customer Returns knowledge article before reading this article. This article is used to help organizations extend customer returns when the product needing to be returned has to be shipped back to an original equipment manufacturer. An extended return such as this is called a Return Merchandise Authorization (RMA). Accounting Seed recommends using the Salesforce case object to tie together transactions that relate to an RMA. Furthermore, statuses and comments related to the case should be added to match your specific RMA process.

Accounting Seed recommends the following relationships are made in your Salesforce instance to the case object to process the RMA effectively:

On the case object, add lookups to the objects listed below. This will allow you to associate a case to a specific installed asset, or sales order inventory movement.

Asset
Sales Order Inventory Movement

On the following objects, add lookups to the case. This will allow you to associate multiple transactions that may need to take place to close the product return.

Inbound Inventory Movement
Outbound Inventory Movement
Purchase Order
Sales Order

With these additional relationships to the case object, a user can record multiple inventory movements as needed to match the status of the physical device.

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Inbound/Outbound Inventory Movements and Inventory Adjustments (Average Cost)

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1013312937