How to write down inventory in AX 2012 without decreasing quantity

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Here is my scenario that is pretty typical in the perishable goods industry:

We have 100 cans of fruit that expire in 2 years which we bout for $100.00. Any left after 1/2 years, we must reduce below our cost to sell. For this reason we write down our inventory every quarter for the reduction in net realizable value. Lets assume that at 12/31/2015 we will have to reduce our inventory by 25%. We will still have 100 cants but now they will be valued at $75.00 and not $100.00, so our write off value is $25.00.

If I use the Inventory adjustment journal, I am required to use quantity, but I do not want to write off any quantity. What is the best solution for this type of inventory value write down?

Thank you in advance for you help.

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Ludwig Reinhard Microsoft Employee on at

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Hello Aijaz,

Most companies that I was working with in the past did those inventory adjustments on a pure GL level. That is, they created various inventory reports to identify what needs to be written down but did the write down actually on specific GL inventory sub-accounts. Maybe that is a solution also for you as this way of doing adjustments avoids problems with inventory reconciliation and the quantity issues you mentioned above.

All the best,

Ludwig

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Weaveriski 23,620 Moderator on at

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During the inventory close process you can adjust the costs of remaining receipts - this writes down the cost without making an adjustment in quantity. Of course this will depend upon your costing method and inventory holding, but ultimately by receipt you can do what you require.

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Brandon Wiese 17,788 on at

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Two easy solutions come to mind.

First, use an adjustment journal to write-out the full quantity at the current value and then write-in that full quantity at the appropriate new value. This maintains the same quantity, keeps the ledger in balance with the new value, and has the advantage of being done all in the same journal and perhaps ideally with a special journal name. I might even recommend posting this journal to the ledger in summary so it makes more sense there.

Second, use the Adjustment under the closing and recalculation form to adjust the On-hand value directly. This process actually accomplishes the value only adjustment by impacting the Cost adjustment on the original inventory receipts that justify the on-hand value, but you take the ledger adjustment in the current period. If you use the Inventory value report to tie-out your ledger to inventory value, it handles this situation properly.

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Mohamed Heikal 7 on at

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Hi,

I think you should use inventory adjustment to solve this issue. Please follow this link.

docs.microsoft.com/.../lva-post-and-print-an-inventory-write-down-document

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guk1964 10,888 on at

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I don't think you should - you will arguably get a false cost of sale if you do and that will affect BOM costs, quotes etc.

When the fit form and function are not the same- which is arguably the case here then it might be better to have a variant part code for short shelf life, or second grade stock otherwise you may have an issue deciding what is new and what is old. Transfer the stock between codes and post the loss to what ever account you decide e.g. stock revaluation.

Then you can also have separate pricing and trade agreement.

You can other wise as suggested above post a write down journal against it - to better reflect the possible impairment of stock value in your balance sheet.

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