Entering Inventory Adjustments

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Campground Master tracks "Adjustments" to inventory on-hand quantity, cost, and price.  This Adjustment tracking, which includes the time and date of the adjustment, is essential for reporting functions such as On Hand by Date and Cost of Goods Sold.  Adjustments can also be reported separately to get things such as a Loss report or Purchases report -- see Adjustment Reporting.



IMPORTANT -- Some Inventory Reports assume that the current On Hand quantity, based on the current quantity for the item in the Edit Inventory Item dialog, is correct.  It then works backwards from that to "back out" sales, purchases, and other Adjustments each day.  Therefore it's extremely important that the you maintain the on-hand quantity by entering adjustments (purchases, losses, inventory counts, etc) as they occur.  If you have not been doing this (e.g. because your previous version didn't support it), see below for retro-actively adjusting inventory.



Entering Adjustments


When you are in Edit Inventory Item, you can click the "Adjust..." button to change the On Hand quantity.  You can also manually change the Cost or Price on that dialog directly, to change the "current" cost or price, which will also be tracked with an Adjustment entry.


There are also several functions for entering Adjustments to inventory on-hand quantities or costs, accessed in the menu under P.O.S / Enter Inventory Adjustments.  These will open the Find Inventory Item dialog, where you can scan an item or search for an item to adjust.


Once an item is scanned/selected, a dialog will open to enter the Adjustment Type, a Reason for the adjustment, and the changes in quantity/cost/price as appropriate.  Note that depending on the adjustment type being entered, some values may not be available for entry -- for instance, when entering an Inventory Count adjustment, only the Quantity can be entered, not a Cost or Price change.


"Cost" note -- The Cost value set in the Inventory Details of each item will be used for the "Cost" column (current unit cost for purchasing).  However if you've set a Cost Accounting Method (other than "None") in Program Options, there will be an option available to Show Calculated cost as of a particular date.  This will add an extra "Calc. Cost" column, showing the unit cost according to the selected cost accounting method, as of that date.  This is especially important if using the Weighted Average method, and wish to create a new accounting period set-point cost (see below).



There are several fixed Adjustment Types.  These determine how the adjustment is handled for various calculations, and cal also be used for reporting to get all adjustments of a particular type.  

Inventory Count -- This is used when you're doing a physical inventory count and need to manually correct the On-Hand quantity to the physical count.


Loss -- This can be used to enter known losses to inventory on hand due to theft, gifting, etc.


Purchase (Receiving) -- If you're using the Purchase Order system, then an Adjustment is automatically created when you do Receiving through Purchase Orders Outstanding (Receiving).  If you're not using Purchase Orders, or when you purchase inventory without a P.O. entered in Campground Master, then you should enter the purchase through this Adjustment type.  Otherwise it cannot calculate Cost of Goods Sold or Cost On Hand correctly.


Weighted Average Cost -- This is a special type of Adjustment that's only used if you're using the "Weighted Average" method for Cost of Goods Sold accounting.  It should be used to "set" the cost at the end of an accounting period, which will be used as the beginning inventory cost for the next period.  Otherwise the Cost of Goods Sold report will not be correct.  


There is also a special button "Reset Weighted Average Cost to the shown calculated cost" available, which should be used at the end of each accounting period to fix a "set-point" cost for the next accounting period when using Weighted Average cost accounting.  You can use it to automatically create Weighted Average Cost adjustment entries for all items (or items currently 'selected' in the list) in one step, assuming the "Calculated cost" shown is correct (which it should be if the proper procedures have been followed since the beginning of the accounting period).  Before using this button, also make sure that the "as of" date show for "Show Calculated cost as of" is the last day of the previous accounting period, since that's both the date used for calculating the cost shown (and used for the adjustment) as well as the date used for the adjustment entries.


Other adjustment (Manual adjustment) --This can be used for some other kind of change in quantity, cost, or price that you want to track but doesn't fall into one of the categories above.



Once a Type is selected, the Reason will be set to the Default Reason selected for that type in Program Options.  However you can select a different Reason as needed, or Edit the pick list to add more reasons for your reporting needs.


If you are attempting to enter a correction on some past date, you can enter the appropriate Date of the adjustment (beware of how this will affect the reporting, though).


When changing the Quantity for an adjustment, you can either enter the Quantity to add amount (which can be negative for reductions, such as a Loss adjustment), or you can enter the New quantity directly (it will calculate the added number accordingly).  Note that only the Quantity to add number is actually recorded in the adjustment -- so for instance if you're entering an old adjustment for a loss (e.g. back-dating it), then the New quantity is not necessarily what the quantity would have been on that past date, since the "Old quantity" shown is always the current on-hand quantity.


Finally, you can optionally enter reference information or notes, which will only be seen on the Adjustment Details report for historical/auditing purposes.



Retro-actively adjusting inventory to correct quantity and cost


Prior to version 11, Campground Master did not "track" inventory other than through sales.  It was up to you to update the quantity on hand manually (or by using Purchase Orders with Receiving).  There was no facility for entering adjustments, and no way to report an On Hand amount for prior dates, let alone Cost of Goods Sold.


Starting State


If you wish to use the On Hand reporting or Cost of Goods Sold, then the first thing you need to do is get your inventory to a correct "starting state".  For the purposes of the Cost of Goods Sold calculations, the starting values of Cost and On Hand for each item (in Edit Inventory Item), before any Adjustments are applied, is treated as the beginning inventory and purchase cost of those units.  Once you get the starting state set, all you have to do is enter Adjustments when an event occurs (usually a purchase or inventory count, but you can also enter adjustments such as removing damaged inventory), and Campground Master will take care of the rest.


If you are about to start a brand new accounting period and don't need to report prior periods, then all you may need to do is make sure the current On Hand quantity and Cost is correct.  However, if you want to try to use Campground Master for reporting the current period that started in the past, then a little more care must be taken when making adjustments.


Important -- If you change the Cost (or Price) of an item through Edit Inventory Item, that will actually create an Adjustment.  Likewise, if there is already an On Hand quantity for the item, it can only be changed on Edit Inventory Item by entering an Adjustment.  If the accounting period of interest has not started yet, then that won't be a problem.  Otherwise, you need to be sure to back-date any Adjustments created when getting those values to the desired "starting state" to some date prior to the accounting period.  For On Hand quantity, you can do this when entering the adjustment.  For Cost changes, you will need to do this through Raw Data Tables / Point of Sale / Inventory Adjustments.  Alternatively, if you don't want to mess with Adjustments to get to your starting state, you can use Raw  Data Tables to edit the inventory On Hand and Cost values manually, spreadsheet-style.


By the way, don't forget to set your Cost Accounting Method in Program Options!



Entering Historical Adjustments


Depending on how precise you want to be on daily amounts and various reports, you can either enter one massive adjustment or try to enter "transactional" adjustments to re-create history.


Note that as you enter Adjustments, the current On Hand quantity will change for the adjustment as if it happened today, even if the adjustment itself is back-dated.  For instance if the current on-hand quantity shows 100 and you enter a back-dated Adjustment where you purchased 200 units, then the quantity will change to 300 (even though you may really only have 100 left due to later sales).  This will be dealt with at the end -- for now, only worry about the quantity "added" for each adjustment





If you have been using the Purchase Orders already, and assuming you use the Receiving function through Purchase Orders Outstanding to update the on-hand quantity as items are received, then you're in luck -- Campground Master will automatically create Adjustment records for all past Purchase Order "Received" amounts.  This will give you instant purchasing history accurate to the date received.


If you have been using Purchase Orders but not Receiving them, or if you don't use Purchase Orders at all, you would enter Adjustments (through Enter Inventory Adjustments / Receiving).  For the most accurate reporting, enter each purchase with its associated, quantity, cost, and date received, for each item.  If you receive items often and don't want to go to that trouble, then you could enter one Purchase Adjustment, dated to the beginning of the period, for the total quantity purchased for the period.  Be aware however that some Cost accounting methods are sensitive to when a purchase is made, especially if the cost has changed.



Losses and other manual adjustments


These are generally important for cost reporting, and depending on the cost method and the reporting needed, the timing could also be important.  As with Purchases, you need to decide whether it's important to replicate history with accurate timing on these.  If not, then skip them and just do the final Count entry.



Count adjustments -- Final adjustment


As with other adjustments, Count adjustments only record the change in quantity -- so it's probably not useful as a historical entry of prior re-counts -- however this is an easy way to get your on-hand quantity correct again after entering other historical adjustments that likely changed it.


What you want to do is enter a Count adjustment, setting the New Qty to the actual current quantity.  However, you're really wanting to fix the starting quantity before your other adjustments were entered (assuming your on-hand quantity was reasonably accurate prior to entering back-dated adjustments).  Therefore it's important to set the Date of this count to be 1 day (or more) before the beginning of your current accounting period.  For instance, if you plan to use reports for the year of 2020, enter December 31st 2019 as the date of the count.  That will enter an "adjustment" on that date of whatever quantity was needed to get the current on-hand set back to the New Qty after all other adjustments.



Set Weighted Cost


This is a special kind of adjustment that's only needed if you're using the Weighted Cost accounting method (it's ignored if that method is not selected in Program Options).  This only sets a Cost "set-point" -- it does not change a quantity, and does not change the "current" Cost for an inventory.  It's used exclusively for Cost of Goods Sold or other Cost reports.


To set a prior weighted cost starting point, enter an adjustment back-dated to the day before the current accounting period (and of course enter your Weighted Cost to use for beginning inventory, as calculated by your accountant for the end of the prior period).  This must be known separately for each item in order to set proper starting costs.



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