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Hi
Looking for thoughts from others on best ways to set inventory up for easy tracking between Inventory and GL.
Based on product groups, we have Class ID's set up that differentiate between the different Sales, COGS and Variance accounts. We have an account set up for each product group for those three items.
We are however only operating one inventory control account. While that seems a simple approach, it isn't necessarily that easy to see where issues arise if out of balances happen.
How do you set yours up? Different inventory control accounts for each product group? Just looking for ideas from others.
Cheers
Heather
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Thanks for taking the time to reply Mahmoud and Frank. I haven't done a huge number of inventory based sites and you always learn along the way!
I think I will work to implement this at both current inventory sites I am working with.
Cheers
Heather
I would concur with Mahmoud - his logic is sound. I've seen clients setup their inventory accounts both ways. A lot of the design has to do with how they want to report inventory on their financials as well.
In a manufacturing environment, companies like to break out inventory by Raw Material, Work in Process, and Finished Goods, since these are logical phases in the manufacturing process.
Regardless of the method you choose, it should conform to reporting needs and reconciliation needs, as Mahmoud states.
When it comes to inventory setup up, I usually consider one of two scenarios. In case I have different product categories with different account groups, several item classes are setup to include the following class-specific accounts:
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