This recipe provides an overview of inventory transfer and discusses how to:
- Set processing options for Inventory Transfers (P4113)
- Transfer inventory
Before you complete the tasks in this recipe, verify that the following information is set up:
- Item and branch/plant information in the F4102 and F41021 tables
- General ledger accounts in the F0901 table
- Processing options for Inventory Transfer (P4113)
- Enter a code from UDC 00/DT that specifies the default document type for transfers. The default document type is typically IT (Inventory Transfers).
- Specify the FROM Location/Lot processing option to define the primary location and lot as the default location that the Inventory Transfers Program (P4113) uses for the From Location and From Lot/Serial fields.
- Specify the TO Location/Lot processing option to define the primary location and lot as the default location that is provided by the Inventory Transfers Program (P4113), in the To Location and To Lot Number fields.
- For the Journal Entries form (P0911), specify the version of the journal entries program to use when you access it from the Row menu on the Work With Inventory Transfers form or from the Form menu on the Inventory Transfers form.
- For the Item Ledger form (P4111), specify the version of the Item Ledger Inquiry (CARDEX) program to use when you access it from the Row menu on the Work With Inventory Transfers form or from the Form menu on the Inventory Transfers form.
- For cost entry, specify whether to display the To Unit Cost and Extended Amount fields on the inventory transfers form.
- For Journal Entries, specify whether to use detailed or summarized journal entries in the general ledger from inventory transfers.
- For Lots on Hold, specify whether to enable transfers from and to lots that are on hold. If the lot status code field on the item/branch plant information form is blank, the lot is not on hold.
- Enter the lot group name to process On-hold items with an allowed lot status. The system validates the lot status code against the specified lot status group setup in Allowed Lot Status Setup Program (P41081).
- For transfer quantities, specify whether to enable transfer that result in a negative On-hand quantity. These are transfers for which, the quantity of the transfer is greater than the On-hand quantity.
An inventory transfer creates two journal entries in the GL (General Ledger). The first journal entry decreases inventory at the original location. The second entry increases inventory at the destination location. Inventory transactions will be performed by using the P4113 application.
To transfer inventory, you must enter transaction and item information for both the original and destination locations. You can set up processing options to provide default values and to display cost information. If you transfer inventory from a location that results in a quantity of zero but is still associated with an amount, the system automatically creates journal entries to the appropriate accounts to balance the amount to zero.
You can correct a transfer that was made in error by entering a reversing entry. Because the system records each inventory transaction for accounting purposes, you cannot delete the record. A reversing entry enters a positive quantity and cost back into the item information at the original location and a negative quantity and amount to the item at the destination location.
You can use the primary location as the default only if all of the secondary locations have a physical location (for example, aisle and bin). If any of the secondary locations have a blank location or lot, you cannot set the primary location as the default.
For summarized journal entries, the system creates a summarized debit total and credit total per account number for all lines in a transfer. For detailed journal entries, the system creates one journal entry (debit or credit) for each detail line in a transfer. The batch type that the inventory transfers program creates is N. This processing option affects journal entries for the F0911 table only. The AAIs (automatic accounting instruction) that are most commonly used are 4122 (Inventory) and 4124 (Expense or COGS). If you use standard costs, the system might create journal entries for the variance, based on AAI 4141 (Inventory or Expense/COGS). The F4111 contains entries for each detail line in each transfer regardless of the way that you set this processing opti on.
- Setting up inventory transactions in Chapter 1,Inventory Management.