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Negative average cost

The manufacturing company I work for used to use Quickbooks Pro 2004. Since this doesn't use Sales Orders, they did everything as Invoices only. Also, to stop getting negatives, all sales parts were non-inventory items. We upgraded to Premier, which allows us to start using Sales Orders. Also, because you can't see sales orders for non-inventory parts, I have been changing parts over to Inventory parts. Assemblies, actually, so I can using Pending Builds to keep track of work orders in production. Since most of the parts are now inventory-able, we did our first full Physical Inventory last month.

However, I have noticed a problem. Somehow, when parts were being changed from non-inventory, and despite being physical inventoried with qty AND value, we have many parts with a negative average cost. In fact, one part in our inventory has an on-hand of 228 pcs, we put in a value of about $6.50 per piece, but QB is showing an average cost of over -$800 ea. In theory, we have over -$200k in inventory of this part!

Does anyone out there know how we could have gotten negative average costs?

On a related problem, I have gone through an inventory/value adjustment to get rid of this, but I think it has increased our inventory value of almost $300k up. Is there a way to print out the inventory/value adjustments? I don't see a big problem with the inventory value adjustment as long as I can show a justification for it.

Thanks in advance all.

Reply to
Head Hunter
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You can see Sales Orders for non-inventory parts, I have all of my manufactured parts set up that way.

Reply to
Leo Navoichick

That's interesting,. because we can't. You do a "Quick Report" on a non-inventory part and Sales Orders are not shown. Even when it is invoiced, only the invoice shows, not the sales order.

Even in the Inventory List, if you show the "On Sales Order" column, it is blank.

Reply to
Head Hunter

Ahh, I see, yes that works the same way on mine. I just haven't ever searched for sales orders that way. The way I normally bring them up is through the "Open Sales Orders by Item" or "Open Sales Orders by Customers" reports.

Reply to
Leo Navoichick

Back to the subject, does anyone know how QB could give an item a negative avg cost? We have a part that went from a qty of zero before our physical inventory to 228 with a negative cost. It was NOT entered that way. If nothing else, QB would not allow us to put in a negative cost. So, where did it come from???

Reply to
Head Hunter

Obviously you had customers come in and drop off their spare parts in your bin.

Reply to
HeyBub

You need to do a report on that part and see where you issued a credit memo and didn't have an invoice for it?

Reply to
Golden California Girls

There has been no change in inventory for that part since the Physical Inventory. In fact, I have restored a backup from right after the Phys, and it shows a positive average cost. There have been NO transactions for it at all, but the avg cost is now negative. Also, according to the backup, at the end of the physical, we had an inventory value of around $250k. Now, if I go back through the Chart of Accounts into the Inventory Asset value to after inventory, it now shows an inventory value of only $35k! In fact, if I go back far enough, it now shows a couple of years ago we had a negative inventory value!! Something in QB2006 hicupped and it changed our inventory value going back to 1999 when we started using QB. Any ideas what would cause QB to, BY ITSELF with no transactions involved, change an avg cost negative?

Reply to
Head Hunter

None, but here is something to try. If you have a pre -06 file around, make a copy of it and convert the copy to -06. Without entering anything, see if your inventory valuation is the same as your pre -06 QB program comes up with. If it isn't, time to call QB, you've found a bug. If it does print the same, then you know it wasn't the conversion. You might want to look at a trial balance to see if something jumps out at you.

Reply to
Golden California Girls

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