Equate Balance of Receipts with Inventory Level (tdipu0201m000)

Use this session to equate the cumulative purchase receipts with the inventory on hand.

The cumulative quantity is increased each time a quantity is invoiced. The quantity is never decreased, so the quantity can become very high. In this case, new receipts no longer affect the average purchase price/landed cost. To calculate realistic average purchase prices and landed costs for the specified item types and items, you can decrease the cumulative receipts by equating its value to the inventory on hand.

You must execute this session periodically only if the following are applicable:

The Method of Calculating Average Purchase Price is Purchases (Cum.) in the Purchase Order Parameters (tdpur0100m400) session.
The Method of Calculating Average Landed Cost is Cumulative Purchases in the Landed Costs Parameters (tclct0100m000) session.

The average purchase price plus the average landed cost can be used to calculate an item's standard cost.

Average prices (Avg. P) are calculated as follows:

(Cum.Receipts * Old Avg.P) + (Qty Received * Order Price) ÷ (Cum.Receipts + Qty Received)
Avg.P New average price
Cum.Receipts Cumulative receipts
Qty Received Quantity received or approved
Old Avg.P Old average price

You can start this session from the Items - Purchase (tdipu0101m000) session.
You can view average purchase prices by item in the Item Actual Purchase Prices (tdipu1500m100) session.
You can view average landed costs by item in the Item Actual Landed Costs (tclct3600m000) session.

Related topics

Item Type

A classification of items used to identify if the item is, for example, a purchased item, a manufactured item, or an equipment item. Depending on the item's type, certain functions will only apply to that item.

Note

LN only takes into account the item's default item type, as specified in the Item Type field of the Items - Purchase (tdipu0101m000) session. The item type that is displayed in the Actual Supply Source field of the Items - Purchase (tdipu0101m000) session is ignored.

For instance, if you set this field to Manufactured, LN does not equate the cumulative receipts with the inventory on hand for items whose Actual Supply Source reads Manufactured, but whose (default) Item Type is set to Purchased in the Items - Purchase (tdipu0101m000) session.

Purchase Price

If this check box is selected, the cumulative purchase receipts are reset for the purchase price.

The cumulative purchase receipts are reset as follows:

Inventory on hand - (received quantity - rejected quantity - invoiced quantity)

Landed Cost

If this check box is selected, the cumulative purchase receipts are reset for the landed cost.

The cumulative purchase receipts are reset as follows:

Inventory on hand - (received quantity - rejected quantity - invoiced quantity)

Test Run

If this check box is selected, a report is printed that displays the simulated equation of the cumulative receipts with the inventory on hand.

Print Report

If this check box is selected, a report is printed that displays the equation of the cumulative receipts with the inventory on hand.