Inventory Production

Purpose

An Assembly Production Transfer serves much the same purpose as an Inventory Quantity Adjustment, though it is used in a different situation. Unlike a quantity adjustment, which is used for individual items, you use a production transfer to indicate when inventory quantities of an assembly item have increased due to internal production. Thus, whenever you have acquired all the components required to create another assembly, you should fill out a production form. Once you have filled out the production form and posted it, all the assembly components that have been allocated to the produced assembly item will be subtracted from your available inventory of component items.

 

Usage

1. Enter a description.

You should always enter a reason for the Production, so that you can later reconstruct your inventory transactions.

2. Select items involved in the production.

Item ID - Either type the Item ID in this field or select using the lookup. You can only select Assembly Items.

Description - This is reproduced here for your reference.

Production Quantity - In this column you should enter the quantity of the assembly item that was produced.

Production Cost - This information comes from the item card. On the card you can enter the Standard Cost, which is presumed to be the cost of production.

Extended Cost - This is the total cost of producing the selected quantity of assembly items. It is calculated by multiplying the Production Quantity by the Production Cost.

To the right of the grid you will see two fields, Total Quantities and Total Amount. Total Quantities is calculated by adding up the Production Quantities column. It represents the total number of assembly items that were produced. Total Amount is calculated by adding up the Extended Cost column. It represents the total cost of producing all the assembly items on this transaction.

3. Post

When you are finished entering all the assembly items that were produced, post the transaction by clicking the Post button. Thought the button says Post, a production transfer does not make an accounting entry. It simply changes the quantities of items.