Returning goods to supplier in MISys using FIFO or LIFO costing method.
Here is the scenario:
Your MISys costing method is FIFO or LIFO and you have multiple locations setup in MISys. You receive an item on a PO into MISys. You then move the inventory to another location (site) in MISys. Then you find out that you need to return the item back to the vendor but MISys gives you an error when you try. Why?
When you transfer an item from the location it was originally received into a new location, the original receiving cost bucket is replaced by the new bucket at the new location. This is to ensure that the FIFO buckets are maintained. As such, once the transfer takes place you can no longer make a return to the supplier in MISys.
What can you do?
In MISys, you could complete a dispense stock transaction to relieve the inventory being returned.
In the accounting system, you will have to create a credit in AP to reflect the amount due back from the supplier for the return. This transaction needs to be coded to the dispense /return control account.
Note that there may be some cost differences with this transaction. When dispensing MISys will use FIFO/LIFO rules to dispense the inventory. As such, the inventory cost may not match the cost of the item being physically returned. In the accounting system, the AP is created for $2,200 (the value of the 04/04/16 receiving) resulting in a $50 difference between the credit value and the dispensed value.
Here is an example using the FIFO costing method for you to follow:
Purchase Date
01/15/16
2/05/16
03/25/16
04/04/16
Quantity
2,000
1,000
1,500
2,000
Cost
1.25
1.00
1.10
1.00
Value
2,000
1,250
1,500
2,200
Location
LOC1
LOC1
LOC1
LOC1
2,000 units are received on 04/04/16 and are subsequently transferred to a different location in MISys. Because FIFO is used for moves in addition to PO receipts, the system will actually move the items received on 01/15/16.
Purchase Date
02/15/16
03/25/16
04/04/16
04/05/16**
Quantity
2,000
1,500
2,000
2,000
Cost
1.25
1.00
1.10
1.00
Value
1,250
1,500
2,200
2,000
Location
LOC1
LOC1
LOC1
LOC2**
** Originally received 01/15/16 **
Then it is decided to return the goods back to the supplier and the items are returned to LOC1
Purchase Date
02/05/16
03/25/16
04/04/16
04/09/16**
Quantity
2,000
1,500
2,000
2,000
Cost
1.25
1.00
1.10
1.00
Value
1,250
1,500
2,200
2,000
Location
LOC1
LOC1
LOC1
LOC2**
** Originally received 01/15/16, moved to LOC2, and then moved back to LOC1 **
In MISys, a quantity of 2,000 is dispensed through Stock control. The value of $2,250 (1,000 x $1.25 + 1,000 x $1.00) is dispensed.
The updated Item I03 follows:
Purchase Date
03/25/16
04/04/16
04/09/16**
Quantity
500
2,000
2,000
Cost
1.00
1.10
1.00
Value
500
2,200
2,000
Location
LOC1
LOC1
LOC1**
** Originally received 01/15/16, moved to LOC2, and then moved back to LOC1 **
In the accounting system, the AP is created for $2,200 (the value of the 04/04/16 receiving) resulting in a $50 difference between the credit value and the dispensed value.
And there you have it. Make sense? If not, better call Paul. I’ll walk you through it.
P.