Non Inventory Items

[Former Member]

Hi

   I want items to be created but i don't want any effect on Inventory Accounts . Should i untick Inventory option . Secondly then what is the the function of Backflush since it will not allow me to select manual Option.

Thanks

[Former Member · Accepted solution]

Hi,

Because when you setup item as non-inventory, you will not be able to issue it manually. There is no inventory for it. So that only backflush can be set as issue method.

Thanks,

Gordon

[former_member186095]

Hi,

if you untick the field inventory item, the item master data will be non inventory. So, you can use it in the sales or purchase document without any effects on inventory account.

But the document type must use service type.

Beside sales and purchase document, you can use the non inventory item in the production order.

if  you use the non inventory item in the production order, you must set the issue method as backflush so that the non inventory item will include in the production order cost calculation.

JimM

[former_member218051]

Hi Sunny,

Inventory Item enables you to use the item in inventory management. For example, you can perform inventory transactions, such as inventory transfers, only for inventory items. If you define the item as inventory only, you cannot sell or purchase it.

Note

To define an item as non-inventory, deselect the Inventory Item checkbox. Items such as services, electricity or labor costs are typical non-inventory items. The additional costs resulting from such non-inventory items are included in the production order. Non-inventory items must use the standard evaluation method and have an expense account (unless it is an item group).

When you define an item as non-inventory, on the "Item Master Data: Inventory Data Tab, you can define the valuation method as standard, and set an item cost for that item. Then, when you base the gross profit on the item cost, the base prices for non-inventory items are included in the calculation of gross profit.

You can change an inventory item to non-inventory, or the opposite, provided that:

•   No transactions have been posted for the item 

There are no documents for the item, that is, sales quotation, sales order, purchase order, A/R or A/P down payment request, or draft

Serial or Batch items cannot be defined as non-inventory.

Thanking you

Malhaar

[former_member217514]

If you uncheck the Inventory Item in the Item Master Data, it will not post to the inventory account but will post to the expense account. 

Once you make an Item a NonInventory Item, you cannot select backflush.  Backflush is used in Production Orders.  Backflush does not require an Item to be issued to a production order, but instead will relieve the inventory or issue the component to the Production Order when Reporting Completion of the parent item in the production order.

Select one of the following issue methods:

•   Backflush – after you report the completion of the parent item, the components are automatically issued to the production order. 

• Manual – the components are manually issued to the production order, regardless of the issue of the product.