fnsacc405 maintain inventory records...fnsacc405 maintain inventory records isbn number:...

FNSACC405

Maintain Inventory Records ISBN Number: 978-1-925782-84-4

Part Number: 405UG

Version: V18.8 2017

AUTHOR – Kerryn Maguire

Kerryn has been working with accounting software products for over twenty years. Originally working from 1994 as an accountant with small business when accounting software became mainstream. Kerryn then focused on providing consulting and training services to small business in particular. Expanding from this into to providing curriculum based resources to TAFE and private RTOs. From this she established Microstar Publishing and more recently incorporated OfficeLink Learning to provide a wide range of resources for the Accounting and Business Services Certificate courses. Kerryn has a long association with many TAFEs and RTOs across Australia. Kerryn’s fundamental aim is to provide resources that are easy to understand while providing a practical application of skills acquired. Kerryn also co-authors two titles for Cambridge University Press which are in their 4th Edition – first published in 2000. Kerryn has considerable experience and knowledge:

Bachelor of Applied Science Mathematics Diploma of Education Graduate Diploma of Accounting CRI: Criterion Referenced Instruction Member of Institute of Certified Bookkeepers Member of VELG

Reproduction and Communication for educational purposes

The Australian Copyright Act 1968 (the Act) allows a maximum of one chapter or 10% of the pages of this publication, whichever is greater, to be reproduced and/or communicated by any educational institution for its educational purposes provided that the educational institution (or the body that administers it) has given remuneration notice to the Copyright Agency Limited (CAL) under the Act. For details of the CAL license for educational institutions contact:

Copyright Agency Limited Level 15 233 Castlereagh Street Sydney NSW 2000 Telephone: (02) 9394 7600 Facsimile: (02) 9394 7601 Email: [email protected]

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© Copyright 2018 OfficeLink Learning ii

All Rights Reserved

© Copyright 2018 OfficeLink Learning. Version 18.8

This User Guide is based on the FNS15 User Guide V17.10 and updated to use AccountRight Plus 2017.1.1

No part of the contents of this book may be reproduced or transmitted in any form or by any means

without the written permission of OfficeLink Learning. All registered trademarks or service marks are

the property of their respective owners. A licence to reproduce this tool may be requested through the

OfficeLink Learning website www.officelinklearning.com.au.

While care has been taken in the preparation of this Training Tool, OfficeLink Learning, the developers

do not accept any liability for any damage or loss (including indirect and consequential loss) incurred by

any person as a result of relying on the information contained in this material. This tool should not be

regarded as professional advice and it should not be relied upon in any important matter without

obtaining appropriate advice relevant to your situation.

It is the Registered Training Organisation’s responsibility to validate the mapping of this tool to the

performance criteria.

Trademarks and Acknowledgements

All terms or products mentioned in this manual that are known to be trademarks have been

acknowledged. OfficeLink Learning cannot attest to the accuracy of this information. Use of a term in

this manual should not be regarded as affecting the validity of any trademark.

Marian Brown’s content has contributed to this text.

Software Description

This course has been designed for users of the MYOB product AccountRight Plus AU (Education) 2017.1.1.

Mac users will need to install and use ‘Parallels’ or similar software, i.e. an emulator installed to allow

the Mac to run PC programs.

The case study in this material uses fictional information.

Accredited MYOB Publisher

OfficeLink Learning has been accredited by MYOB as a Publishing Partner and has met the selection

criteria to hold this status.

Additional Support Material

You can access the required student exercise files and support material for this unit via the OfficeLink

Learning website.

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Contents

© Copyright 2018 OfficeLink Learning iii

Contents

Unit 1 Introduction ......................................................... 1 Purpose of this workbook ......................................................................... 1

Prerequisites ........................................................................................ 1

Delivery .............................................................................................. 2

Relationship to Competency Standards ........................................................ 2

What you will need ................................................................................ 2

Conventions used in this User Guide ........................................................... 3

Symbols used in this User Guide ................................................................ 4

Installing AccountRight Plus 2017.1 on a Windows PC ...................................... 5

Backing up your company file ................................................................. 12

Glossary of terms ................................................................................ 14

Unit 2 Setting up inventory using AccountRight .................... 15 Learning outcomes ............................................................................... 15

About Accounts NOW ............................................................................ 16

Notes on Inventory ............................................................................... 17

Business Reporting Requirements ............................................................. 18

Starting AccountRight Plus ..................................................................... 19

Customising the Accounts List ................................................................. 20

Checking tax codes .............................................................................. 23

Linking Sales and Purchases accounts ........................................................ 25

Creating cards for suppliers .................................................................... 26

Creating Item Cards – using perpetual inventory ........................................... 27

Planning Item Numbers ................................................................. 27

Creating item Cards ..................................................................... 29

Creating more Item Cards ...................................................................... 34

Creating auto-build items ...................................................................... 38

Entering stocktake figures...................................................................... 44

Correcting stocktake figures entered ........................................................ 48

Entering account opening balances ........................................................... 50

Customising item purchase orders (Optional task) ......................................... 51

Skills checklist .................................................................................... 54

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Contents

© Copyright 2018 OfficeLink Learning iv

Unit 3 Manually recording inventory .................................. 55 Learning outcomes ............................................................................... 55

Notes on stock cards ............................................................................. 56

Setting up a Stock Card .......................................................................... 57

Entering transactions on a Stock Card ........................................................ 58

Entering the transactions in the General Ledger ........................................... 60

Stock Card exercise 1 ............................................................................ 63

Assigning Cost of Stock .......................................................................... 63

Using FIFO and Weighted Average cost formula ............................................. 65

Stock Card exercise 2 - FIFO .................................................................... 68

Stock Card exercise 3 – Weighted Average ................................................... 69

Sample Forms - Inventory ....................................................................... 71

Manual Stock Card exercises .................................................................... 73

Skills checklist ..................................................................................... 75

Unit 4 Recording inventory in AccountRight ......................... 77 Learning outcomes ............................................................................... 77

Accounts NOW Policies and Procedures Manual ............................................. 78

Checking minimum levels of stock ............................................................. 81

Creating a purchase order ....................................................................... 82

Viewing your transactions to this point ....................................................... 88

Recording the delivery of items ................................................................ 89

Recording the delivery of purchase 001 ...................................................... 90



Manually record the delivery of order 003 ................................................... 94

Viewing your transactions to this point ....................................................... 95

Viewing analysis ................................................................................... 98

Auto-building manuals to be sold .............................................................. 99

Display Items List [Summary] after Auto-build ............................................ 101

Purchasing items at a different purchase price ........................................... 102

Viewing the Weighted Average and Last Cost of adhesive pockets .................... 103

Selecting your Item Sales – GST Inclusive Invoice ......................................... 104

Recording the sale of Inventoried Items .................................................... 104

Update your stock cards ....................................................................... 108

Viewing Profit and Loss for the current month ............................................ 108

Recording a sale of Inventoried Items ...................................................... 109

Display the Sales Detail report for items sold ............................................. 113

Display the Analyse Sales [Item] report .................................................... 114

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Contents

© Copyright 2018 OfficeLink Learning v

Entering the return of items sold ............................................................ 115

Settling the return of goods ................................................................... 116

Entering Inventory Adjustments .............................................................. 117

Display Transaction Journal ................................................................... 118

Entering a sale and printing a packing slip ................................................. 119

Entering a Purchases Return .................................................................. 123

Entering stocktake figures..................................................................... 125

Viewing sales reports and analysing item profit ........................................... 127

Using AccountRight OfficeLink with Excel .................................................. 129

Viewing and analysing selling prices ......................................................... 130

Changing selling prices ......................................................................... 133

Viewing sales history of items ................................................................ 135

Adjusting item values .......................................................................... 137

Using the standard cost option ............................................................... 139

Receiving items without the Tax Invoice ................................................... 142

Entering the sale of items in Receive Items................................................ 144

Recording the receipt of the Tax Invoice ................................................... 145

Skills checklist ................................................................................... 151

Unit 5 Using Periodic Inventory in AccountRight ..................153 Learning outcomes .............................................................................. 153

Setting up accounts for item cards for periodic inventory .............................. 154


Unit 6 Consolidation exercise .........................................159 Learning outcomes .............................................................................. 159

About the exercise .............................................................................. 160

Review the company file for Auto Service Centre ........................................ 161

Create item cards ............................................................................... 162

Enter Inventory stock numbers ............................................................... 164

Customise item sales invoice ................................................................. 165

Select default item purchase order ......................................................... 165

Enter budget amounts ......................................................................... 165

Create a job ..................................................................................... 167

Enter transactions for the current month .................................................. 168

Enter transactions .............................................................................. 169

Print reports for January 2019 ................................................................ 174


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Contents

© Copyright 2018 OfficeLink Learning vi

Appendix A Elements of Competency and Performance Criteria ...................................... 177

Appendix B Solutions to exercises ..................................... 179

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Setting up inventory using AccountRight

© Copyright 2018 OfficeLink Learning 15

Unit 2


Learning outcomes

In this unit you will:

set up the Accounts List to meet the needs of the business

set up linked accounts

create cards for suppliers

plan item card numbering system using perpetual inventory

create item cards using perpetual inventory with a variety of scenarios

create auto-build items

print Stock Ledger and Auto-Build reports

enter opening balance in the General Ledger to reconcile with the Stock Ledger.

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About Accounts NOW

To learn how to use the Inventory Command Centre, you will enter

the inventory transactions for a business selling computer training

manuals like the manual you are using.

The business, Accounts NOW, sells training manuals for a

computerised accounting package, PALER Accounting.

The business also sells the software and holds training workshops in

this software package.

The training manuals are written by Hayley Browning of Accounts

NOW; however, the manuals are printed and bound by a commercial

printer.

Accounts NOW packages the books for resale, by placing a plastic

pocket and data CD in the back of the workbook and sometimes

supplies a Test Drive CD of the program.

Sales: Training Manuals:

PALER for Beginners V3

PALER Advanced V3

PALER Payroll V3

Software:

PALER Accounting V3

PALER Accounting with Payroll V3

PALER Test Drive V3

Training Workshops

Purchases: Accounts NOW buys the following components:

Printed Training Manuals

Data CDs

Adhesive Pockets

Test Drives

Software

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Notes on Inventory

There are two methods of accounting for inventories (or valuating stock):

1. Periodic (also known as Physical) Inventory

Items are bought and sold however; no record is kept of the number and value of items on hand.

Periodic Inventory is covered in Unit 5.

2. Perpetual Inventory

Items are bought and sold, AND a record is kept of the number and value of items on hand.

Perpetual Inventory offers the following advantages.

• The number and value of stock on hand is always available.

• The Gross Profit figure in the Profit and Loss Statement is accurate.

• Many inventory reports can be printed so that profit margins can be checked regularly; stock levels controlled, and stock shortages can be detected.

Accounts NOW will use Perpetual Inventory to track the following.

• The number of printed manuals on hand

• The number of printed manuals with a plastic pocket, data CD and Test Drive packed ready for resale (using the auto-build feature)

• The number of Software and Test Drives on hand.

Accounts NOW will use Periodic Inventory to record the purchase and sale of mouse pads. This item is often given to clients as a gift or used in the office.

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Business Reporting Requirements

Following discussions with the accountant an Accounts List (also known as a Chart of Accounts) has been created to enable the following:

• On a monthly basis, a Profit and Loss (Statement of Financial Performance) can be printed so that the owner knows how the business is performing.

• On a monthly basis, a Balance Sheet (Statement of Financial Position) can be printed.

• GST reports on a Cash Basis and Business Activity Statement can be printed.

• Items Cards will be created to use Perpetual Inventory.

• An Item Card for Mouse Pads will be created using Periodic Inventory.

• Stock Levels will be monitored so that:

the business does not have too much stock on hand resulting in cash being invested in stock on the shelf instead of paying creditors etc.

the business does not have too little stock which means unhappy customers and loss of sales.

• Profit Margins can be identified.

The business has set up an AccountRight Plus company file called

Accounts NOW v2017 2018.myox which should be stored in the

folder you chose when downloading your files.

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Starting AccountRight Plus

Start AccountRight Plus and Open a File

1. Double-click on the AccountRight icon on the desktop.

2. Click Open a company file.

3. The company files in My Library are then listed.

4. Select the Accounts NOW v2017 2018.myox file by double-clicking on it.

Notes: If you have not yet added your company files to the library please refer to page 7 for instructions on how to do this.

MYOB AccountRight Plus files have the extension myox.

The User ID and Password dialog box appears with a default User ID of Administrator in this case

5. You do not need to enter a password here.

6. Click OK and the Command Centre of AccountRight Plus will appear.

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Customising the Accounts List

You will first review the existing Accounts List and make the changes required to meet the needs of the business. Some accounts need to be amended and others need to be added

Below is an edited Accounts lists with the accounts that need to be added/changed highlighted in bold.

Edited Accounts List

1-0000 Assets 1-1000 Current Assets (Header account)

1-1100 Chq A/c – NAB 123456

1-1110 Undeposited Funds

1-1120 Electronic Clearing Account

1-1200 Payroll Clearing Account

1-2000 Accounts Receivable (was Trade Debtors)

1-3000 Deposits with Suppliers

1-4000 Inventory

2-0000 Liabilities

2-1000 Current Liabilities (Header account)

2-1050 Business Credit Card (Account Type = Credit Card)

2-2000 Accounts Payable (was Trade creditors)

2-2100 A/P Accrual - Inventory 2-3000 GST Liabilities 2-3010 GST Collected

2-3020 GST Paid

2-5000 Payroll Liabilities (was Other Payroll Liabilities)

3-0000 Equity

3-1000 Capital 3-2000 Drawings

3-8000 Retained Earnings

3-9000 Current Earnings

3-9999 Historical Balancing Account

You will have to click

on the Down button to

indent these accounts

to the correct level.

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4-0000 Income

4-1000 Sales – Manuals 4-2000 Sales – Software 4-3000 Training

4-4000 Freight Collected

5-0000 Cost Of Sales

5-1000 Cost of Sales – Manuals 5-2000 Cost of Sales – Software 5-5000 Freight Paid

6-0000 Expenses

6-0500 Advertising 6-1050 Books Written Off

6-1200 Office Supplies 6-1250 Research & Development Costs 6-1300 Telephone 6-2100 Wages & Salaries Expenses

6-2200 Other Payroll Expenses

8-0000 Other Income

9-0000 Other Expense

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To edit an account:

1. Click on the zoom arrow to open the account that needs amending and change the Number and/or Name.

2. For example, click on for 1-1000 Cheque Account

3. Click into the Account Number box and change it to 1-1100 and then click into the Account Name box and change it to be Chq A/c – NAB 123456 and then click on OK

To create a new account

1. Click on the New button.

2. Select if the new account is a Header or Detail Account. Header accounts are used to group detail accounts. You cannot post transactions to header accounts.

3. Type the Account Number and Name.

4. For example, 1-1000 Current Assets is a Header account so Click on Header

5. Type the second part of the Account number 1000

6. In Account Name type Current Assets

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7. In the Details tab of each Header account you edit or create, select the When Reporting, Generate a Subtotal for This Section option.

8. Click on OK

Note: When you are entering new accounts remember to click on the

Details tab and apply the tax code – N-T is most cases for Asset and Liability accounts. GST in most cases for Income, Cost of Sales and Expense accounts. You will check these codes in the next task.

Checking tax codes

The easiest way to check or add tax codes is as follows:

1. In the Command Panel (located at the bottom of Command Centre), select Reports, and then select Accounts reports.

2. Select the Accounts List [Summary] and then click Display Report.

3. Click on the Insert/Modify tab, choose to Show the Account No. and the Tax code and then click OK.

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Below is a list of the tax codes required for the accounts. Check and amend the tax codes as necessary:

1-0000 Assets

1-4000 Inventory GST Remaining Accounts N-T

2-0000 Liabilities all N-T

3-0000 Equity all N-T

4-0000 Income 4-1000 Sales – Manuals GST 4-2000 Sales – Software GST 4-3000 Training GST

4-4000 Freight Collected GST 5-0000 Cost Of Sales

5-1000 Cost of Sales – Manuals N-T 5-2000 Cost of Sales – Software N-T 5-5000 Freight Paid GST

6-0000 Expenses 6-0500 Advertising GST 6-1050 Books Written Off N-T

6-1200 Office Supplies GST 6-1250 Research & Development Costs GST 6-1300 Telephone GST 6-5100 Wages & Salaries N-T 6-5200 Employment Expenses GST

4. To update an account, click on the Account No. or the Account Name in the report, to open the Edit Accounts

Note: In the Report Display window, the tax code will not change. You need to click Run Report at the top of the window to view the updated codes.

5. Return to the Command Centre.

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Linking Sales and Purchases Accounts

We need to ensure the correct accounts are used to track freight charges collected and paid, to track items received without an invoice and to track deposits paid to suppliers. To do this, we need to set up some linked accounts.

To setup Sales Linked Accounts

1. Click Setup in the Menu Bar and select Linked Accounts, then Sales Accounts.

2. Click on I charge freight on sales

3. Type 4-4000 in the link box and TAB then OK

To setup Purchases Linked Accounts

1. Click Setup in the Menu Bar, select Linked Accounts and then Purchases Accounts.

2. Link Receive items without a Supplier bill to 2-2100 A/P Accrual - Inventory

3. Link Freight on purchases to 5-5000.

4. Link Deposits paid to suppliers to 1-3000.

5. Click OK and return to the Command Centre.

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Creating cards for suppliers

1. Click on Card File in the command centre

2. Click Cards List, then click New.

3. Change the card type to Supplier

4. Enter the name of the supplier Kwik Kopiers and assign a Card ID if you want.

5. Enter an address, phone number and contact person of your choice.

6. In the Buying Details tab, select the Item purchase layout and enter the ABN for the supplier: 33 034 404 550

7. Click on OK

8. Repeat for the following suppliers:

a. Illawarra Stationers (ABN 33 333 444 555)

b. Computer Software Suppliers (ABN 33 444 555 444)

9. Click OK then Close to return the Command Centre.

Purchase Layout

ABN

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Creating Item Cards – using perpetual inventory

Accounts NOW want to track the following information:

• number and value of items purchased

• number and value of items sold

• number and value of items on hand

• items which fall below minimum levels on hand

• where items are stored

• average cost of each item (weighted average)

• profit margins for each item.

Before creating your item cards, item numbers must be considered.

Planning Item Numbers Designing your Item Numbers is very important. Some thought should be given to your numbering system before creating your Item Cards.

There is provision for 30 characters/numbers in your item number.

Accounts NOW’s numbering system is built on the basic design below – using 6 characters/numbers only.

The first character indicates if the item is purchased or is built: P = Purchased A = Auto-build

The second character indicates the type of item: M = Manual S = Software O = Other

The third, fourth and fifth characters will indicate the name of the manual or software. PFB = PALER for Beginners

The sixth character will indicate the version: 3 = Version 3

P

F

B

Note: Some businesses use the purchasing item number as their sales item number, however this can be a problem if the supplier changes the item number or the seller changes the supplier.

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Based on the 6-character formula, the Item Number for Software - PALER Accounting V3 is:

PSPAC3 – This item number is meaningful to the owners.

P = Purchased

S = Software

PAC = Paler Accounting

3 = V3

You will see how perpetual inventory works when you begin processing sales.

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Creating item cards

1. Click on Inventory in the Command Centre.

2. Click on Items List then New.

3. Enter the following in the Profile tab.

Item Number: P(urchased) S(oftware) PAC(PALER Accounting) 3 (version)

Item Name: PALER Accounting V3

Item is: Purchased, select I Buy

Sold, select I Sell

Stock is tracked, select I Inventory

Link these preferences to the accounts shown below.

Note: Linked accounts for buying, selling and inventory. When an item is received into the store, the value is added to Inventory. When an item is sold, the average cost is deducted from Inventory and posted to Cost of Sales and recorded in Sales at the selling price.

4. No details will be entered in the Item Details tab.

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5. Click on the Buying Details tab and enter the following information.

6. Click on the Selling Details tab of this item.

7. Enter the following details including a base selling price of $499.00 inc GST.

8. Click OK.

Supplier’s name and Supplier’s catalogue number. Re-order Qty not required.

The business requires a minimum of 2 on hand at any time.

The buying unit is each.

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9. Create the following items:

ITEM: PALER Accounting with Payroll V3

a. Enter item number PSPAP3, and item name of PALER Accounting with Payroll V3.

b. The name field provides for only 30 characters; therefore, the full name will have to be entered in the Item Details tab.

c. Select I Buy, I Sell and I Inventory, and assign the appropriate accounts if not already appearing by default.

d. Enter the following details:

Selling Price: $699.00 including GST

Restocking information:

Minimum restocking level: 2

Supplier: Computer Software Suppliers

Supplier Item Number: WINPAP

Restocking Qty: 0

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ITEM: PALER for Beginners V3 (Manual)

This manual is purchased from the printer however; the manual cannot be sold in this form. A Test Drive, plastic pocket and a data CD must be added to the book for resale.

Therefore, this item will be purchased (select I Buy) and inventoried (select I Inventory) only - not sold (do not select I Sell).

a. Type in the following Profile details:

b. Enter the Buying Details:

With the Item still displayed click on New to enter the next item –

many of the selections will already be made.

The business orders 15 copies of this workbook every time they order.

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ITEM: PALER Payroll V3 (Manual)

Item Number: PMPPY3

Item Name: PALER Payroll V3

Buy Only: Select I Buy, I Inventory

Restocking Information:

Minimum Level: 15

Supplier: Kwik Kopiers

Supplier Number: PPY3

Re-order Qty: 15

ITEM: PALER Advanced V3 (Manual)

Item Number: PMPAD3

Item Name: PALER Advanced V3

Buy Only: Select I Buy, I Inventory

Restocking Information:

Minimum Level: 15

Supplier: Kwik Kopiers

Supplier Number: PAD3

Re-order Qty: 15

10. Click on OK to close the Item.

Your Item List should look like this:

11. Click the (zoom arrow) next to any incorrect items and make the necessary adjustments.

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Create more Item Cards

These items will be used eventually to build an item for sale.

ITEM: CD Adhesive Pockets

These pockets are bought in boxes of 100. The business uses 1POPKT in the back of each manual.

Profile details:

Buying Details:

Figure entered here is BUYING UNITS, i.e. the business always wants to re-order 5 boxes.

Letter 0 in number = Other (not a Manual or Software)

Buy in a box of 100 but use one at a time.

Figure entered here is SELLING UNITS, i.e. the business always wants 150 pockets on hand.

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ITEM: CDR 25 (Data CDs)

CDs are purchased in spindles of 25 and 1 is placed in the back of

each workbook with company files. Profile details:

Buying Details:

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ITEM: PALER Test Drive V3 (Software)

• Bought in packets of 10 and 1 is placed in the back of each PALER for Beginners Workbook only.

• The Test Drive is not placed in the back of the PAYROLL or ADVANCED Workbooks because users already have a Test Drive when they purchased the Beginners workbook.

• The Test Drives are also sold separately.

Profile details:

Buying Details:

This item is bought and sold. Enter linked

accounts.

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Selling Details:

Check your Items List

1. Display your Items List. It should look like this.

2. Click the (zoom arrow) next to any incorrect items and

make the necessary adjustments.

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Recording inventory in AccountRight


Unit 4


Learning outcomes

In this unit you will:

read Policies and Procedures of Accounts NOW

print a Stock Alert report (Purchase Requisition)

enter Purchase Orders

receive delivery of goods

receive goods on backorder

enter Tax Invoices received

enter return of goods and adjustments

analyse journal entries in relation to perpetual inventory

print Sales reports

analyse sales, profit margins, change selling prices

use the Standard cost option

use the Receive Items feature.

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Accounts NOW Policies and Procedures

Extract from Accounts NOW Policies and Procedures

Perpetual Inventory is used for all stock except for Mouse Pads which uses

Physical Inventory because these items are often given away as gifts and used

in the office.

An Item Card is set up for each stock item. Minimum numbers and re-order

quantities are entered to optimise stock levels and assist with automatic

reordering of stock.

PURCHASES

1 Each morning the Stock Alert report is printed. The printout is

handed to the manager who authorises which stock is to be ordered.

This printout acts as a Purchase Requisition.

2 Orders are generated automatically or keyed in and printed or

emailed to the supplier. The Purchasing Officer must always be on

the lookout for better prices from alternative suppliers.

3 A copy of the Purchase Order is sent to the Store. A second copy is

kept on file in the office. Each Purchase Order will be numbered

consecutively in AccountRight and missing Purchase Order numbers

must be accounted for.

4 The Purchase Order must contain a complete description of the

goods ordered and price including GST, delivery address and any

special delivery instructions.

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5 When goods are received, the store person must check that all goods

received are in good order and condition. Goods must be checked

against the Purchase Order to make sure the correct goods and

quantity have been delivered. If a Packing Slip or Delivery Note was

sent with the goods, this must be attached to the Purchase Order

and forwarded to the Accounts Department. If no Packing Slip was

received, the store person should complete a Goods Received slip

and sign and attach it to the Purchase Order.

6 Any discrepancies must be reported to the manager. It is the

responsibility of the manager to contact the supplier, not the store

person.

7 If goods are to be returned for any reason, a Goods Returned slip should

be completed by the store person and forwarded to the Accounts

Department for entry into AccountRight.

8 Should there be goods on backorder; a copy of the Purchase Order must

be kept in the store noting the goods on backorder. When goods are

received, the Purchase Order is then forwarded to the Accounts

Department.

9 Any invoices received with the goods must be forwarded to the Accounts

Department immediately. It is the responsibility of the Accounts

Department to check the prices on the Tax Invoice and calculations and

attach the Tax Invoice to the Purchase Order on file plus the Purchase

Order and Delivery Note or Goods Received as proof of delivery of the

goods. The Purchase Order in AccountRight should then be changed to a

Bill checking prices, invoice total and enter the Supplier’s Tax Invoice

Number and invoice date.

10 A physical stocktake is to be taken at the end of January and end of

June.

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Answer the following questions

1. What procedure is carried out each morning?

.............................................................................

.............................................................................

2. What is the purpose of this procedure?

.............................................................................

.............................................................................

3. If the business did not implement minimum levels in their accounting

software, how would the business determine what stock needs to be

ordered?

.............................................................................

.............................................................................

.............................................................................

Solutions can be found in Appendix B.

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Checking minimum levels of stock

To view items below the minimum number

1. Open the company file for Accounts Now.

2. In the Command Panel, click the To Do List.

3. Click the Stock Alert tab.

4. Print a copy of the report by clicking Print.

PRINTOUT 3 - Minimum levels of stock

All the items in your report are below the minimum level entered in the Item

Cards in Unit 2.

For example, there are only 5 PALER Advanced V3 on hand, but the minimum

level is 15.

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Creating a purchase order

The manager has authorised the purchase of the three printed manuals.

1. Click in the column beside the manuals you want to order.

2. Click Order/Build.

3. Enter the date for the order as 5/01/2019 and click OK.

4. Click Print, to print a copy of your purchase and select the customised

purchase order layout.

5. Accept that the purchase order with be recorded.

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PRINTOUT 4 – Purchase Order

Look at the printed order and note the following:

• The re-order quantity of 15 is printed in the Qty column.

• The Supplier’s item number has been printed, not the item number you use in Accounts NOW.

• No price has been entered because these items have not been purchased since the company file was set up. AccountRight uses the last cost price automatically, unless the standard cost option is activated (covered later in this workbook).

• There is no Delivery Method or Date Required showing.

We will now add the prices and details before the order is emailed to Kwik Kopiers.

1. In the To Do List, click Orders.

2. Click next to the order we just created to open it.

3. In the Purchases – Edit Item window, add the following information.

a. Prices to be entered are GST Inclusive, so select the Tax Inclusive option.

b. In the Price column enter the following new prices:

PALER for Beginners V3 new cost to print/bind $23.10

PALER Payroll V3 new cost to print/bind $19.25

PALER Advanced V3 new cost to print/bind $20.35

TOTAL: $940.50

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c. Type 10/01/2019 in the Promised Date field.

d. Change Terms to Net EOM after EOM.

4. Click Send To, select Email and click OK to the prompt that the Order will be recorded before sending.

5. In the Email window, enter other information if needed.

6. To send the email, you would click Send. The email would be sent to the Outbox of your email program, with the purchase order as an attachment. For this exercise, click Cancel.

7. Close the To Do List to return to the Command Centre

Click here to change the Terms.

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Creating the order for CDs and Pockets

1. Click To Do List then click the Stock Alert tab.

2. Select the 700MB CDR and CD Adhesive pockets and then click Order/Build.

3. Set the order date to 5/01/2019.

4. Ensure the order is tax inclusive and enter the buying prices:

CDs (10 spindles) $15.00 per spn including GST

Adhesive pockets (5 boxes) $77.00 per box including GST

Total Amount = $535.00.

5. Click Record. Do not print.

Creating the order for software

1. In the Stock Alert window, select PALER Accounting V3, PALER Accounting with Payroll and PALER Test Drive V3 and then click Order/Build. The Purchases - New Item window appears.

Note: No restocking quantities were entered for PALER Accounting or PALER Accounting with Payroll, but AccountRight has automatically ordered the number required to make the minimum number as per the Buying Details tab of the Item Information window (shown below).

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2. We want to order more than the minimum quantity, so make the following changes.

5 PALER Accounting V3 $325.00 inc GST

3 PALER Accounting with Payroll V3 $495.00 inc GST

5 PALER Test Drive V3 $59.00 inc GST

Value of Order = $3,405.00

3. We want to pay for this order on the Business Credit Card. In Comments, enter Please charge my Business Credit Card – details on record.

4. Enter the Promised date as 10/01/2019 and select a preferred delivery method in the Ship Via field.

5. Click Record. Do not print the purchase order.

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Record the credit card payment for the order

1. In the Purchases Command Centre, click Pay Bills to pay for the order on the credit card.

2. Click in the Supplier box and start to type Computer Software Supplies until the name appears and then press TAB

3. Change the Pay from Account to be Business Credit Card

4. Change the date to be 5/01/19 – the same as the Order date

5. Enter the invoice Amount of 3,405.00 in the Amount box

6. Click in the Amount Applied column.

7. Press TAB. The Out of Balance amount should show $0.00.

8. Click Record.

9. Click on Cancel to return to the Command Centre.

Important: Backup your company file You may need this backup if you make errors on the following pages. To identify the backup later, record the name here.

.........................................................................

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Viewing your transactions to this point

1. In the Inventory Command Centre, click Transaction Journal.

2. Click the All tab and enter the dates from 1/01/2019 to 5/01/2019

Your Journal should look like this:

Note the following:

• No entries have been made for purchases because all three orders are orders only, and the goods have not been received, therefore no money is owing.

• The Credit Card payment has credited the Credit Card Account and debited Deposits with Suppliers because your business will not owe the money until the goods and/or invoices are received.

3. Close to return to the Command Centre.

4. Click on Items List to display it. Note that the numbers of stock on hand have not been altered because the items have not yet been received.

5. Close to return to the Command Centre.

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6. Go to the Index of Reports, click on the Inventory tab, select Analyse

Inventory [Summary] and click Display Report.

Your report will look like this:

This report lists the number on hand, number ordered and availability of each item.

Note: You ordered 10 spindles of CDs each containing 25; therefore, you have 250 selling units on order (sell one at a time).

7. Close out of the report and return to the Command Centre.

Recording the delivery of items

The manuals ordered have now been delivered. The delivery was accompanied

by a Packing Slip and a Tax Invoice.

According to the organisation’s Policies and Procedures:

1. What should the store person do with the Packing Slip?

.............................................................................

2. What should the store person do with the Tax Invoice?

.............................................................................

Solutions can be found in Appendix B.

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Recording the delivery of purchase 001

The delivery note, a copy of the purchase order and the tax invoice have been received by the Accounts Department.

The tax invoice received looks like this.

Kwik Kopiers Tax Invoice ABN 33 034 404 550 13382

Address

TO: Accounts NOW Delivery Address:

64 Training Avenue 64 Training Avenue

Melbourne VIC 3000 Melbourne VIC 3000

Date: 10/01/19

Purchase Order

Number: 001

Terms: EOM after EOM

Quantity Item Number

Description Unit Price Inc GST

Total inc GST

Tax Code

15 PAD3 PALER Advanced v3 $20.35 $305.25 GST

15 PFB3 PALER for Beginners V3 $23.10 $346.50 GST

15 PPY3 PALER Payroll V3 $19.25 $288.75 GST

$940.50

Amount of GST in this invoice: $85.50

Delivery Method: Courier

Delivery Date: 10/01/19

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1. Click To Do List and select Purchase Orders.

2. Open Order 001 by clicking next to it. The order is displayed.

3. Check the Tax Invoice against the order to make sure the business is being charged for the correct items and billed the correct price.

4. Check the Tax Invoice is valid, for example has the supplier quoted their ABN?

The correct goods have been received and the Tax Invoice is correct.

5. Change the date to 10/01/2019.

6. Click Bill at the bottom of the window. (Note the change in colour.)

7. Enter the Supplier’s Invoice Number - 13382.

8. Is the Invoice total in AccountRight the same as the Tax Invoice total?

9. Click Record. Do not print.

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The following tax invoice has been received.

Illawarra Stationery Tax Invoice ABN 31 245 784 444 8932 Address TO: Accounts NOW Delivery Address: 64 Training Avenue 64 Training Avenue Melbourne VIC 3000 Melbourne VIC 3000

Date: 10/month

Purchase Order Number:

002

Terms: EOM after EOM

Quantity Item Number

Description Unit Price Inc GST

Total inc GST

Tax Code

10 700MB

CDR25

700MB CDR $17.05 $170.50 GST

3 8180-100 CD Adhesive Pockets $77.00 $231.00 GST

2 8180-100 ON BACKORDER

Subtotal: $401.50

Freight: $26.50 GST

TOTAL: $428.00

Amount of GST in this invoice: $38.91

1. Open order 002.

2. Click Bill.


4. Enter supplier invoice number 8932.

5. Change Terms to Net EOM after EOM.

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6. Enter $26.50 inc GST Freight at the bottom of the invoice.

7. Change the price of CDs to $17.05 inc GST per spindle.

8. Only three boxes of pockets were received so type 3 in the Bill column and TAB to Backorder and type 2 to put the remaining two on backorder. The order should look like this.

9. Check the total of $428.00, then Record the purchase. No need to print. The items on backorder will remain in Order Number 2.


The items on purchase order 003 have now been received.

The Tax Invoice has also been received. All details are correct.

1. Open purchase order 003.

2. Click Bill.


4. Enter the supplier’s invoice number S114.

5. Record the Bill. Do not print.

6. Close the To Do List to return to the Command Centre.

Freight Bill Backorder

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Manually recording the delivery of order 003

1. Open your book to the section on Manual stock cards, at the end of Unit 3. Record the delivery of Purchase Order 3 (excluding the Test Drives).

PALER Accounting V3 $295.45 ex GST

PALER Accounting with Payroll V3 $450.00 ex GST

You can check your stock card with the solutions in Appendix B.

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Viewing your transactions to this point

1. View the Transaction Journal (ALL Journals) from 5/01/2019 to 10/01/2019. Excluding the initial opening balance transaction, the transaction journal should look like this:

2. Check the accuracy of your data.

3. If you find an error, open the transaction and make the required adjustment.

4. If you cannot fix the error, delete the transaction and re-enter it.

5. Close the Transaction Journal

When Order 3 was recorded, the amount of money being held in ‘Deposits with Suppliers’ was transferred to Accounts Payable and paid to Computer Software Suppliers.

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6. View your Items Lists. The number of items on hand has now been

updated and the Last Cost recorded.

Important: If you find that some of your amounts are not exactly the same as the book, even though you are sure you have keyed in transactions accurately, it may due to minor error corrections you mad along the way.

For example, if you edit a sale and make a change, like add freight, amounts will automatically recalculate using current weighted average costs. So sometimes differences can occur.

7. Click on Print to print the Items List [Summary] report

There are now 295 CDs on hand. 45 (stock take figure) + 10 spindles of 25 each = 295. The last purchase price was $17.05 spindle including GST. * indicates price includes GST.

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PRINTOUT 5 – Items List [Summary]

The report should look like this:

AccountRight uses Weighted Average Cost. For example:

1/01/2019 45 CDs on hand @ $0.60 each

$27.00

10/01/2019 purchase 10 spindles @ $17.05 = $170.50 inc GST

cost price 10 spindles @ $15.50 ex GST

that is 250 CDs @ $0.62 each

$155.00

Weighted Average: 295 CDs valued at

$182.00

Weighted Average $182 divided by 295

= $0.6169

Note: AccountRight has rounded this weighted average to $0.62

8. Close the Items List

Excludes GST

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Elements of Competency and Performance Criteria


Appendix A

Elements of Competency and Performance Criteria

Elements of Competency and Performance

Criteria – FNSACC405

Element Performance Criteria Demonstrated

1 Process inventory purchase

1.1 Record purchase of inventory from appropriate documentation in subsidiary ledger

Units 4, 5, 6

1.2 Maintain periodic and perpetual records of inventory

Units 4, 5, 6

2 Record inventory flows

2.1 Apply inventory flow assumptions as appropriate

Units 4, 5, 6

2.2 Value inventory using appropriate valuation rules

Units 4, 5, 6

3 Reconcile inventory records to general ledgers

3.1 Reconcile all inventory records to accounts in accordance with organisational policy, procedures and practices

Units 4, 5, 6

3.2 Identify and action discrepancies according to organisational policy, procedures and practices

Units 4, 5, 6

4 Prepare inventory schedules and ad hoc reports

4.1 Develop and document schedules of inventory turnover and other procedures

Unit 4

4.2 Prepare spreadsheets and ad hoc reports on inventory status as required or requested

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fnsacc405 maintain inventory records...fnsacc405 maintain inventory records isbn number:...

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