Have a job dilemma and am wondering what the proper procedure should be to fixing it.
The scenario is as follows:
A job closed a few months ago was now noticed to show that we issued material twice to it. The finished goods were put into stock and transferred to a different site and then shipped to a customer. None of these parts are anywhere between these two sites.
The parts are no longer there, but the physical raw material still remains where the job was manufactured. How do I get that material back into stock again? Quantity adjustment or do we try to do something by re-opening the job and taking the material out?
Trying to find the proper way to do this without causing more of a headache.
It depends on how you want to handle it. Do you want the Production Detail to look accurate? If so, then open the job and Return the material directly from the job.
If not, you can do a Return Miscellaneous Material transaction. This returns the material to inventory but does not affect the job at all. You will need a reason code for the return, though. You may want to put the job number in the Reference field so if there are any questions later, you will remember what happened.
@Beth’s answer is the easiest… but i will offer the “part 1” side of her answer…
if the at job is still open, then you can simply return the inventory back to stock.
if the job is not still open, you can re-open it, then return the inventory. then close it again.
what all the above will do depends on your costing method. If you are average cost, then it will probably post some variances when you reclose it because there is no place for the cost to go. If you are standard cost, there probably was already variances posted, and therefore, returning the inventory to stock will undo those variances. But in any case, the dollars will flow to where they should flow.
This one is a mess because Site A manufactured the part and transferred to Site B and shipped to a Site B customer.
If I open the job in Site A, they take a variance hit I think, correct? They have the physical material in-house so we have to at worst case, adjust it back into their stock.
Site B received the finished good from Site A at a low cost, which was then turned around and shipped to Site B’s customer. They don’t have any of that material left in stock so they can’t do a cost adjustment on their side.
Both sites need to take an adjustment, but I just don’t know the lesser of two evils…
so, it might just be easiest to do the Inventory adjustment in Site A, and find out the total value of the inventory that was adjusted… THEN in Site B, create a manual journal entry to charge the inventory to the correct COGS accounts. Site B doesn’t need an inventory adjustment, but the value needs to go somewhere.