To run the Aged Inventory Report:The Aged Inventory Report helps you prioritize inventory according to the time it takes to sell the products in the line. This report examines the annual sales of each item in the line, determines the number of pieces on hand, and calculates how long it will take to sell those items.
Note: If you understand the purpose of the Aged Inventory Report and want to skip to the procedure click here.
For example, if you sold 365 items last year (1 per day or 30 per month) and have 700 on hand and use 3-month periods, the aging buckets are as follows:
|
|
Number of Items |
Time period for... |
|
A |
90 items |
0-3 months |
|
B |
90 items |
4-6 months |
|
C |
90 items |
7-9 months |
|
D |
90 items |
10-12 months |
|
E |
360 items |
over 12 months |
The Aged Inventory Report also helps you determine how your products lose value, if any, over the course of the year. If inventory does devalue over time, you can use the writedown buckets to show the percentage of devalue for the aging period.
For example, using the information in the previous example, the cost basis of Cost of Goods Sold is $1.00 per item. The writedown for each aging bucket is a cumulative 20 percent.
The writedown for the aging buckets would be as follows:
|
|
Calculations |
Cost |
For time period... |
At... |
|
A |
((90 items * $1.00) * .20) |
$18 |
0-3 months |
20% |
|
B |
((90 items * $1.00) * .40) |
$36 |
4-6 months |
40% |
|
C |
((90 items * $1.00) * .60) |
$54 |
7-9 months |
60% |
|
D |
((90 items * $1.00) * .80) |
$72 |
10-12 months |
80% |
|
E |
((360 items * $1.00)* 1) |
$360 |
for over 12 months |
100% |
If no items were sold in the last year, the report devalues the inventory according to the writedown percentage associated with the No Sales aging bucket. For example, in Canada, this report can be used when claiming devalued inventory on taxes. In the United States, this report can assist in long range inventory planning and budgeting, when holding items in inventory longer than a particular period of time can become a drain on capital assets.
The Aged Inventory Report lists the following:
Product ID and description.
Price line.
Year-to date sales for the item.
On-hand supply of the item.
Unit cost per item.
Total value of the item before and after the writedown percentage by the different aging periods.
Years supply of the item in inventory.
Grand totals by price line and by all price lines.
To run the Aged Inventory Report:From the Purch > Reports menu, select Aged Inventory, to display the Inventory Valuation criteria screen.
In the Br/Tr/All field, enter the branch or territory for which you want to run the report. Type ALL to include all branches and territories.
In the As of Date field, enter the date from which you want the inventory aged. The system populates the field with the current date. Press F10 to display a calendar and change the date.
In the Price Line field, indicate the price lines to include on the report. Do one of the following
Enter the price line name to run the report for a single price line.
Leave the field blank to run the report for all prices lines.
Use the Price Lines hot key to choose more than one price line. *Multi* displays in the field.
In the Cost Basis field, enter the cost basis to use for valuing inventory. The system populates this field, with Cost of Goods Sold - Cost (COGS-COST). Press F10 to select another cost basis.
In the Writedown % for x Months fields, enter the percentages that the value of the products in the specified price lines are reduced over the specified period of months. For example, if product is on the shelf for more than 6 months, the value can decrease by 25%.
In the Writedown % for No Sales field, enter the percentage that the inventory value is reduced if there are no sales, or no demand for the inventory in the last year. This field populates with 100 percent.
Use the Writedowns hot key to change the default periods for this run of the report. For example, you can change the breakdown of months from 0 - 3 months to 0 - 6 months for the first writedown bucket.
To indicate the percentage beyond a period of months, type OVER in a From field and the corresponding month in the related To field.
Note: If writedown buckets are not used on the report, 0% is applied to the unused buckets.
In the Nonstock (Inc/Exc/Only) field, indicate whether to include non-stocks in the reports. Press F10 and select from the following:
Include - Prints non-stocks on the report.
Exclude - Does not print non-stocks on the report.
Only - Selects only non-stocks for the report.
In the Zero On-Hand Qtys (Inc/Exc) field, indicate whether to include products that have on-hand quantities of zero from the reports.
Include - Prints products with zero on-hand quantities on the report.
Exclude - Does not print products with zero on-hand quantities on the report.
In the Exclude Level (Br/Pd) field, select how the Exclude First Received in last field looks at items first received.
Select Branch if you want to report on the first receiver per branch. Select Product to report on the items received for the first time within the number of days you specify in the Exclude First Received in last field.
In the Exclude Items Created in last field, enter the number of days you want to limit the report to for product recently added to your product file. For example, you might want to exclude any products you have added in the last quarter.
In the Exclude First Received in last field, enter the number of days you want to limit the report to. The system will not include items that are onhand or sold if any branch or product, depending on the setting in the Exclude Level field, meets this cutoff number or days.
In the Exclude if First Receipt After field, enter the date you want to limit the report to. The system will not include items that are onhand or sold if any branch meets this cutoff date.
Press Esc to return to the main menu.
See Also: