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Hi, is it possible to item charge fee for storage ONLY to unsold stock. For example, posted purchase receipt and invoice was for 2 units. One unit was then sold. Now, there is a storage fee to pay on the one remaining unit. When user item charges the storage fee, it updates the cost on what was already sold but I'm looking to find out if it's possible for the item charge to apply only to the quantity remaining in inventory. Cost method is FIFO.
2nd question would be whether the above scenario is a recommended practice from accounting perspective or should the storage fee really be distributed to the entire received lot without regard for when quantities are sold.
thank you.
I think that not possible by standar.
From accouting and business perspective it should be distributed and I've given you an example for that.
Let's take your 2 units, you've bought them by 100 each and freight it's 20 for both. I sell one to customer A (the one I sell first) for 200 and another one to customer B for another 200.
In your proposition the revenue will be:
In mine proposition the revenue will be:
If you study all your operations, you will say that A is a better customer but the reality it's the same.
I guess that the problem it's that the accounting department don't want to change revenue of the closing months but as I explain it would give you a bad reading of the business itself.
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Sohail Ahmed
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Mansi Soni
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YUN ZHU
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