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Microsoft Dynamics GP (Archived)

Inventory of Tools and their effect on Financials

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Posted on by Fahad Humayun 1,357

I have items in inventory which are issued to technicians for some project. Either they consume the item (e.g. Batteries, oil filters) on site or they return it to Inventory. In case of consuming the item, we charge the cost and send invoice to the customer.

In the same manner of inventory system, we have tools in inventory which are actually supporting our technicians (e.g. Plair, Wrench and Screw Drivers). They are not meant to be consumed on site and they are always returned to Inventory.

My Finance has a question as when these tools will be charged out. They are concerned about it because all the tools in inventory are of high value.

Is there any way when we purchase these tools, only the purchasing cost effect the P&L but doesn't keep the cost in ASSETS while TOOLS are part of Inventory or MIT.

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  • Fahad Humayun Profile Picture
    Fahad Humayun 1,357 on at
    RE: Inventory of Tools and their effect on Financials

    Hi Leslie,

    First of all my apologies for not replying your queries as I was out of station and couldn't get to talk to my Finance department. I am gonna talk to them and discuss keeping your illustration infront and will get back.

  • L Vail Profile Picture
    L Vail 65,271 on at
    RE: Inventory of Tools and their effect on Financials

    Hi Fahad,

    When the tools are issued to technicians, where do you want it to appear on your financials? If you are buying high value tools that are not consumed, it seems to me that they ought to be reflected as assets. You may want to choose a different account to keep track of the ones 'issued out', rather than calling them 'inventory'.

    My clients that do this kind of thing have to decide whether to handle them in fixed assets or inventory. Those that do not have inventory, open up different warehouse sites and then do an inventory transfer to assign the items to the specific technician.

    In a perfect world, how would you want it to work?

    Kind regards,

    Leslie

  • Suggested answer
    Community Member Profile Picture
    Community Member Microsoft Employee on at
    RE: Inventory of Tools and their effect on Financials

    No financial effect will be affected, only for record.

  • Fahad Humayun Profile Picture
    Fahad Humayun 1,357 on at
    RE: Inventory of Tools and their effect on Financials

    Hello Daoud,

    Thank you for helping me. Unfortunately, my company has not purchased HR module. However, we are running payroll module.

    If I use the Property screen of HR to manage this, how this will effect on Financials?

  • Suggested answer
    Community Member Profile Picture
    Community Member Microsoft Employee on at
    RE: Inventory of Tools and their effect on Financials

    Hello Fahad,

    If your tools been materials with high values then it should be capitalized and added to your fixed assets register, however otherwise for screw drivers and other low cost materials you can use the properly screen of the HR to manage each employee properties and export these out of your inventory accounts.

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