Purchase orders / Stock holding / Ledger

[CRAIG]

HI Folks,

Sage details:
Version Number 22.1.10.394
SBD Desktop Version 12.1.586.0
Sage 50 Accounts Professional
Microsoft Windows 7 Professional 64-bit

I have a question about Inventory stock holding?

When I raise a PO and book it in the stock is booked against the ledger code selected for the product if I'm correct ( so stock value will be Qty x cost price£)
When I adjust stock/stock take/write off does this just affect the product Qty on the ledger code (stock value becomes new qty x cost price £)

Do these adjustments create postings anywhere or do they just increase/decrease the stock figure? (We dont sell any stock we are using it purely for in house stock management)

When our accounts do month end where does is the stock valuation generated from? Is the stock accounted twice (once on the ledger code, once on the month end closing stock total)

Is is better to raise all products on orders onto a single stock holding ledger code then book out at month end onto the individual ledger codes by product using Stock Valuation?

Where do the "Stock nominal code (balance sheet)"
and "Closing stock nominal code (P&L)"
tie in?

thanks
Craig

[brucedenney]

There are 3 different ways that stock is valued!

The simple one is to use the average price and multiply by quantity or to use the last purchase price multiplied by the quantity

However, you can also calculate the value of everything that has come into stock and delete the value of everything that has gone out of stock (on a FIFO basis)

In the valuation reports the "Retrospective Valuation" is the one that uses the values of each individual transaction.

[CRAIG]

Hi Bruce,

thanks for responding

Do adjustments to stock generate a posting to the P&L anywhere? Or does the stock just sit in the nominal ledger it was alloacted to when the order was received into stock?

When accounts run month end and run the Stock Valuation report - where do the values for stock come from, and do these generate a posting to the p&L

We are concerned that we have positive stock value sat in ledger somewhere and we are then posting the value of stock at month end, in addition to it already being in the ledger ( if that makes sense)

thanks
Craig

[brucedenney]

Individual adjustments to stock have NO impact on the P&L

the way the P&L is influenced is by a month end journal, which is based on a product valuation.

Modules>Wizards>Opening Closing Stock