Overview

The Single most important function of inventory categories is they will populate the default GL accounts for inventory items when they are created. So attention needs to be applied to assigning GL accounts to an inventory category. The default GL accounts can be carried through to the financial reports to allow for segmentation and analysis on the balance sheet and P&L statement. Categories are also used as a selection type on most inventory reports and to complete Physical Counts. 

     There is a second tab that will allow you to define what functions will affect inventory usage calculations. The Inventory Purchase Assistant sets minimum inventory levels based on usage. Some companies would like transactions like issues and transfers to affect this minimum order point and others would not. This screen gives you the option to make those decisions on a category-by-category basis. 

Pre-requisites:
Buyers

Open

• Category – Enter a Category code: you will want it to be short enough that it is not tedious to repetitively type when placing orders but concise enough that you know what it is by looking at it.

• Description – The description will define what the code is and default into reports and screens as needed

• Buyer – the buyer is a default that can be left blank if needed. Some companies have different buyers for assigned for different items: one buyer for chemicals one for equipment.

• GL Accounts – These are the default accounts that will populate into the inventory item screen during setup. It is the category that defines the default GL accounts for an item.

  • Sales GL – The sales account for this inventory category

  • Inventory GL – Which inventory account items in this category will hit when they are received and shipped.

  • Cost GL – The cost of goods sold for items in this inventory category

  • Accrual – This item category Accrual Account

Some of the more advanced concepts in the TRX Enterprise™ inventory control system are that of the Purchase assistant and the PO generator. When it comes to effective inventory management controlling your turns is essential. Too much inventory is idling capital and not enough is a potential sale out the door, empty handed. To help manage your turns we employ a purchase assistant that will measure historical vendor lead times and cross-reference against inventory usage over a period of time to define a minimum stock quantity that you should carry. This minimum inventory level is then fed into a PO generator that will poll all items for a vendor and display everything that needs to be ordered so you may capitalize on free freight when possible.

     The key to this process is "usage" we allow you to define what usage is, or better stated what you would like to consider an inventory deduction. To some a vendor RMA may be considered in usage because it is leaving inventory to others it may not be because it was purchased for a reason, usually a customer specific order and then returned and they are just completing the process. You can choose how each transaction type should be handled and you can choose by individual categories.