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2010/04/12

GL Impact of Selling Non-Inventory Items

Hi everyone!

This is a pretty exciting time for IT-Ration Consulting, as we're slowly changing our name to ERP GURU. The new name really represents us better as a whole, and I think our clients will agree.

Today I would like to take some time to talk to you about how to get a non-inventory item to post to your GL in NetSuite. As some of you may know, non-inventory items are items that you sell but do not keep in stock. What's important to keep in mind is that unlike regular inventory items, even if you receive a non-inventory item, it does not affect inventory asset, nor does it impact the cost of goods sold (COGS).


As you can see in the screenshot above, when you receive a non-inventory item, you cannot specify the rate at which you receive it. If you check the GL Impact of the item receipt and item fulfillment, you would also notice that the non-inventory item has no impact whatsoever on those records.

In order to circumvent this NetSuite default, I suggest you create an assembly item  instead.This method will allow you to take into account the purchase prices of both inventory and non-inventory items when impacting COGS and inventory asset accounts.



2 comments:

  1. Wouldn't an assembly item also affect inventory since it has an inventory asset account?

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  2. That's correct. I realize it may not have been clear in the post, but I was talking about a specific case where you would want a non-inventory item or other charge to generate cost when being sold, like cost of labor.

    If you try to package an item with labor costs into a kit/package, for example, the labor will have no GL Impact.

    ReplyDelete