Creating inventory companies

  1. Select Supply Management Setup > Groups and Companies > Inventory Companies.
  2. Click Create.
  3. Specify this information:
    Company
    Specify a company name.
    Description
    Provide a description.
    Item Group
    Select an item group.
    Costing Method
    The costing method determines the unit cost for outgoing inventory transactions such as issues, adjustments, and transactions. Select an option:
    • Average Costing: This method combines each purchase with the former inventory balance to determine a new average unit cost. The average cost is recalculated with any addition to stock on hand.
    • First In First Out : This method is based on the oldest receiving cost record on file in inventory
    • Last In First Out: This method is based on the newest receiving cost record on file in inventory.
    • Standard Costing: Inventory cost is based on the standard cost value specified for inventory items by location in Item Location.
    Number Of Periods
    Select the number of annual periods for this company.
    Current Year
    Select the current year.
    Current Period
    Select the current period.
    Last Year End Date
    Select the ending date from the last period of last year. This date is used to determine the date range for the first period of the current year.
  4. On the Main tab, specify this information:
    Require UOM Entry On Transactions
    Select this check box if the unit of measure is required for any inventory transactions. If this check box is selected, you must specify a unit of measure. If this check box is cleared and the unit of measure is not selected, then the unit of measure from the item location record is used. If the transaction unit of measure is blank, then the stock unit of measure is used.
    Allow Negative Stock On Hand
    Select this check box if the stock on hand quantity can be a negative value and the standard or the average costing method is used.
    Allocate Partials
    Select this check box to allocate partial quantities of the original item. This value is used by Requisitions. Select this check box to allocate partial SOH quantities before switching to a replacement item to satisfy additional demand.
    Allow Override of Last Cost
    Select this check box to enable the Last Receipt Cost on Item Location. This is only applicable when the item has a stock-on-hand of zero at this location.
    Allow Override of Source UOM
    Select this check box to override the source UOM.
    Inventory Returns at Average Cost
    Select this check box to use item location's Average Cost for Inventory returns transaction.
    Ordering Cost
    When you first set up the company, specify the average rate cost of ordering an item. You must define this cost to calculate economic order quantities (EOQ) in Economic Order Quantity and Reorder Calculation. Ordering cost increases as the number of orders that are placed increases.
    Allocation Method
    Select the way that inventory items are allocated in Warehouse. Online allocation occurs when the requisition or the order is released.

    Batch items are allocated when you run the batch allocation program in Warehouse.

    Allocation Basis
    Select the sequence in which demand is satisfied. Select By Priority to allocate demand by priority. The type of date that is used is set when you define the billing company. If the demand records have the same date, they are sequenced by document number.
    Carrying Cost Percent
    Specify the percent of the inventory carrying cost. This percent is used in the economic order quantity calculation.
    Requisition Approval Type
    Specify the requisition approval type.
    Default Requisition Comment Type
    Select to display the comment type.
    Apply Maximum Requisition Quantity To
    Select the location the requisition quantity is allocated to.
    Pricing Group
    Select a pricing group.
    Lot Tracking At From Location Only
    Select to track from location only.
    Do Not Allow Expired Lot On Transaction
    Select check box to ensure the expired lot on transactions are not allowed.
    Use Global Average Cost
    Select this check box to run Create Global Average Cost action.
    Bypass Account Defaulting For Replenishment Requisitions
    Select this check box to bypass account defaulting.
    Track Stock UOM At Item Location
    Select this check box to track the UOM at the item location.
    Order UOM Rounding
    Select to round the UOM.
    Quantity
    Select number of decimal points quantity shows.
    Cost
    Select number of decimal points cost shows.
    Work Order in Use
    Select this check box to enable work order activities.
  5. In the Available To Allocate section, specify this information:
    Backorder
    Select Subtract From Stock on Hand to subtract the back ordered quantity from the available to allocate quantity.
    On Order
    Select Add To Stock On Hand to add the on order quantity to the available to allocate quantity.
    Intransit
    Select Add To Stock On Hand to add the intransit quantity to the available to allocate quantity.
    Work In Process
    Select Add To Stock On Hand to add the work in process quantity to the available to allocate quantity.
    Inspection Hold
    Select Subtract From Stock On Hand to remove the inspection hold quantity from the available to allocate quantity.
  6. In the Available To Sell section, specify this information:
    Backorder
    Select whether to include the back ordered quantity in the available to sell quantity. Select Subtract From Stock On Hand to subtract the back ordered quantity from the available to sell quantity.
    On Order
    Select Add To Stock On Hand to include the on-order quantity in the available to sell quantity.
    Intransit
    Select Add To Stock On Hand to include the intransit quantity in the available to sell quantity.
    Work In Process
    Select Add To Stock On Hand to include the work in process quantity in the available to sell quantity.
    Inspection Hold
    Select Subtract From Stock On Hand to remove the inspection hold quantity from the available to sell calculation.
  7. In the Default Priority For section, specify the Requisition, Work Order, and Customer Order.
  8. In the Item Master Sync section, specify the Item Sync Option.
  9. Click Save.