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Incorrect Inventory Balance in Inventory Valuation Report

Dec 02, 2016 at 12:12 PM

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Dear All,

My customer use non- perpetual and have some issue about inventory balance during process month end closing.

Sample Scenario:

1. First, Users don't have Stock opening balance, so stock balance (Qty. and Cost) = Zero (0)
2. They created three A/P Invoices, Journal Entry as below

PU1 : Debit Purchase 1000 Credit A/P 1000
PU2 : Debit Purchase 1100 Credit A/P 1100

3. They created a A/R Invoice.
IN1 : No Transaction about stock because of non-perpetual.


4. Then, They cancelled PU1 because wrong price and create New A/P Invoice as same price as PU2, it is correct price. System generated two Journal Entry as below:


Cancel PU1 : Debit A/P 1000 Credit Purchase 1000
PU3 : Debit Purchase 1100 Credit A/P 1100

As the above,

Stock Balance should be 1,100
Purchase Balance in G/L = 2,200
and Cost of Goods Sold (Opening Inventory Balance + Purchase - Ending Inventory Balance) = 0 + 2,200 - 1,100 = 1,100


But Inventory Valuation Report with Moving Average Method = 1,066.66.
So, Cost of Goods sold will equal 0 + 2,200 - 1,066.66 = 1,133.34.

Please advise me. Thank you very much.

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