Looking for best practice recommendations on how users handle the PV source journals where ROG unit cost differs from ROI. Do you go inventory adjustment to correct the unit cost if so how often monthly, annually etc. Thanks.
If the differences are big, and the inventory is on hand, you can do adjustments to re-value the stock (and correct current cost/expense amounts). Otherwise, the Purchase Variance account should be a cost…
Returns don't work for some valuation types (FIFO / average...), and can't handle Landed Costs. We usually do corrections with inventory adjustments and journal entries.
If the variance is insignificant, then allow it to just proceed with posting to the variance account. If the variance is significant, then I always suggest a PO Return of Goods to take the item out of inventory, a corrected PO Receipt of Goods at correct unit cost, then the PO Receipt of Invoice.
If the differences are big, and the inventory is on hand, you can do adjustments to re-value the stock (and correct current cost/expense amounts). Otherwise, the Purchase Variance account should be a cost/expense type, so you really shouldn't need to do anything.
Returns don't work for some valuation types (FIFO / average...), and can't handle Landed Costs. We usually do corrections with inventory adjustments and journal entries.
Thank you for all the replies. Much appreciated. Customer requested report every month to see if any variances are large enough where an adjustment is warranted in inventory. First time Sage user and it has always been an issue on their old ERP.
*Community Hub is the new name for Sage City