Defining Inventory, Job Costing Considerations, and Warehouse Locations

□	For Inventory Tracking and Job Costing System Users:

•	Sale-Purchase Item entries representing Inventory Items may be used Both for a Sale item and as a Purchase item, when using the Accounts Payable System as well as the Inventory Tracking System and Job Costing System.

•	As with all Data Entry Forms with MKMS, Yellow indicates a mandatory field that must be completed for the record to be saved.

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Sale-Purchase items Form - Inventory Item

•	This Sale-Purchase Items Form may be Re-sized by Dragging the Top and/or Bottom up or down, and/or the Right side in or out.

•	Navigation Menu - The Navigation Menu is located at the top of the Sale-Purchase Items Form.

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•	This Navigation Menu provides the normal Record Movement, New, Edit, Delete, Cancel, Save, and Refresh options; as well as Print, Search, Proposal Description, Warehouse Inventory, Documents and Vendor Item ID functions.

•	Defining Inventory Item:

•	Click the New (/) Icon

▪	Complete the normal Sale-Purchase Item information outlined below as required.

▪	Then complete the Inventory related additions or exceptions explained below.

•	Sale Item Group - Optionally, you may enter a Sale Item Group using the Drop-Down Selection List provided.

▪	If you have a large quantity of Sale-Purchase Items, this Sale Item Grouping feature allows you to Select the desired Sale-Purchase Item from a filtered list (based on the Sale Item Group assigned to it).

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The Advanced Sale Item Lookup function (accessed with Alt+F2 from within the Sale-Purchase Item Drop-Down Selection List on Sales, Proposal, Purchase Order and Purchases forms) lets you Select from a list of items limited to a specific group - thereby presenting a much shorter list from which to choose.

•	Item Section:

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Sale Purchase Item - Item section

•	Item ID - Enter a unique Item ID of up to 40 alpha-numeric characters (most punctuation marks are also permitted).

►	Note: Create a generic Sale-Purchase Item named Parts assigning it the code Parts.

This becomes the Default Parts Code which should then assigned as such within the Inventory Options tab of the User Options Form.

•	Item Type - This is an Inventory Item and so will be used Both for recording a Sale and a Purchase.

▪	Once an Inventory record is saved, if a User changes the Item Type field of an Inventory related Sale-Purchase Item to Sale rather than Both, the record cannot be saved without Un-Checking the Inventory Item box on the Sale-Purchase Item Form, and confirming that it is no longer an Inventory Item.

▪	This action also requires confirmation because the Sale-Purchase Item will no longer be considered (or tracked as) an Inventory Item.

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Inventory designation removed!

•	Retail Price - Enter the usual Retail Price for this item.

•	Non Report - Check Non Report if this item should not be included in certain Sales Analysis Reports.

•	If you are using the General Ledger System, these fields will be highlighted in Yellow indicating a mandatory entry.

▪	Sale GL # - Enter the General Ledger Account Number for this type of Sale.

▪	Dept - If you have initiated the use multiple Departments, enter the appropriate Department number using the Drop-Down Selection List provided.

▪	Purchase GL # - If this Sale-Purchase Item is assigned an Item Type of Purchase, or represents Both a Sale and a Purchase item, both the Sale GL # and the Purchase GL # must be entered using the Drop-Down Selection List provided.

•	Check boxes - There are several Check Boxes that may, or may not be needed based on the specific Purpose of this Inventory Item:

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▪	Non Report - Check Non Report if this Inventory Item should not be included in certain Sales Analysis Reports.

▪	Show on Work Order / Service Request - Check the Show on Work Order / Service Request box if this Sale-Purchase Item has been assigned an Item Type of Sale or Both and might be needed when recording the use of Inventory and/or Materials on a Service Request.

o	The Drop-Down Selection List used to Choose the appropriate Inventory Item used on a Work Order, accessed within the Web Tech Service, will contain only those Sale-Purchase Items which have a Check in the Show on Work Order / Service Request box.

o	The Drop-Down Selection List used to Choose the appropriate Inventory and/or Materials usage in the Inventory/Materials tab of the Service Request Form will contain only those Sale-Purchase Items which have a Check in the Show on Work Order / Service Request box.

o	By Not Checking this box, this Inventory Item will not be included in the Drop-Down Selection List lists that are provided to a Technician working in the field using the Web Tech Service or to any User recording information within the Inventory and/or Materials tab on a Service Request Form.

The result is that any Sale-Purchase Items that are defined to identify Purchases or Sales that are unrelated to providing Service to Subscribers will be eliminated from the list - making that Selection process easier and faster, thus reducing the Drop-Down Selection List list to a manageable size, and more importantly, with a definable content.

▪	Show on Proposal - Check the Show on Proposal box if this is coded as a Sale item (or Both) and it may be used on a Proposal (also see Proposal Description below).

▪	Inactive - Located within the Inventory section of the Sale-Purchase Item Form, this Check box identifies an Inventory Item as Inactive and therefore no longer in use.

o	The Inactive Check box is provided because, once entered and used, a Inventory Item cannot be deleted because it has become part of the Transaction "History" of the system.

o	Checking this box will remove this item from the Drop-Down Selection List es normally used to Choose a specific Inventory Item for a Sale or Purchase.

•	Taxable? - Check this box if this item is taxable, the default state. If this item is never taxed, be sure to Uncheck this box.

•	Commission Activation Fee - Check this Box if this Sale-Purchase Item is to be considered an Activation Fee when it is included as part of a Proposal Package used in conjunction with the Commission Tracking System.

•	Commission Points - Enter a Point Value (representing its approximate cost) if this Sale-Purchase Item can earn Banked Commissions Points for the Salesperson or Technician when it is sold.

▪	The Commission Points assigned to a Sale-Purchase Item should represent an approximate Cost for the acquisition and installation of the Inventory Item.

▪	Commission Points are assigned a Point Value - on an Employee by Employee basis - in the Personal tab of the Employee Form.

•	Description - Enter a clear, somewhat concise description of this Inventory (Sale-Purchase) Item entry.

▪	Up to 70 alpha-numeric characters may be entered, upper and lower case letters are allowed, most punctuation marks, with spaces also permitted.

▪	For Sale-Purchase Items defined with an Item Type of either Both or Sale, a more detailed Description using the Proposal Description Icon on the Navigation Menu at the top of this Sale-Purchase Item Form may be defined.

□	General Ledger System Users Only:

•	If you are using the Inventory Tracking System and the General Ledger System: (Note that these fields will initially be highlighted in Yellow):

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Inventory Item defined on Sale-Purchase Items Form with Active General Ledger

•	Sale GL # - Enter the General Ledger Account Number for this type of Sale.

•	Purchase GL # - Enter the General Ledger Account Number of the default Cost of Goods Sold [COGS] account identified in Mandatory Accounts.

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Mandatory Account Declaration entries

▪	Once this record is saved, the Purchase GL # will be locked and shown in Gray.

•	Dept - If you are a General Ledger System User and have initiated the use of multiple Departments, enter the appropriate Department number using the Drop-Down Selection List provided.

□	Understanding the Inventory and Inventory Info Sections:

•	Completing the Inventory Section:

•	Inventory Item - Check the Inventory Item box.

▪	When you Check Inventory Item, the Sale-Purchase Item Form will require additional information needed to properly track Parts as actual Inventory.

▪	If an Inventory Item is entered, and saved, and subsequently a User attempts to Remove this Check mark, a Warning will be displayed.

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Warning - Inventory designation removed

▪	Answer appropriately using special care.

•	Inactive - Never Check the Inactive box unless this Inventory Item is no long used.

▪	Do not Delete an Inventory Item once it has been used in an Invoice (either for Sales or Purchases).

▪	If you will no longer order or sell the Inventory Item, just mark it as Inactive.

•	Kit Designation - Check the Kit Designation box if this is an Inventory Item that actually consists of several individually ordered and sold parts that you have designed as an internal "Kit".

►	Note: See a complete discussion of User Defined Kits and how to create them in Kits - Designing Your Own Parts Package.

•	Completing the Inventory Info Section:

•	Part Group - Enter a Part Group code.

▪	This is a user definable code which has no associated link to any predefined data set.

▪	It is for internal use only, as appropriate, to accommodate the Company's needs.

▪	This field may be used within a filter expression defined in the Report Builder module.

•	Vendor - Enter the (preferred) Vendor from whom this Inventory Item is generally Purchased using the Drop-Down Selection List provided.

▪	Right-Click in this field to Choose the Search By method (Vendor Name or Vendor ID).

▪	This Search By selection will determine whether the chosen Vendor's Name or their Record ID number will be displayed in the Vendor field.

•	Enter the Price In for this item, regardless of whether it is Both a Purchase and a Sale, or just a Purchase which will be the default price used for the Inventory Item when entering a Bill.

◆	How and whether the Price In and/or Value fields will be displayed within the Inventory Info box is based on which Inventory Valuation Method has been elected.

▪	Price In - This will be displayed as a normal mandatory field if this is an Inventory Item and the Average Inventory Cost Inventory Valuation Method has not be elected.

o	If the Price In Inventory Valuation Method is in effect, the contents of this field will remain unchanged unless modified manually.

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Inventory Info box - LIFO or Price In Inventory Valuation Method selected

o	If the LIFO Inventory Valuation Method is in effect, the contents of this field will be updated whenever another Inventory Item of this type is Purchased.

▪	Price In (Average Cost of this Item) - If the Average Inventory Cost Inventory Valuation Method is in effect, this is a system maintained field which is updated, as needed, using the Calculate Average Inventory process.

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Inventory Info box - Average Cost Inventory Valuation Method selected

▪	Value (total value of this Inventory Item that is in stock) - If the Average Inventory Cost Inventory Valuation Method is in effect, this will be a system maintained field which is updated, as needed, using the Calculate Average Inventory process.

•	Committed Available - The Inventory Quantities & Status information shown at the bottom of the Inventory Info box displays information that cannot be changed without accessing the Warehouse Inventory Icon (see below).

▪	If the actual On Hand level is less than the established Re-Order level for this Inventory Item, an 'On Hand' Low message will be displayed.

•	Sale Item Group - Optionally, you may also enter a Sale Item Group using the Drop-Down Selection List provided at the top of the Form.

▪	If you have a large quantity of Sale-Purchase Items, Sale Item Grouping allows you to use the Advanced Sale Item Lookup feature to select the desired Sale-Purchase Item from a pre-limited list (based on the Sale Item Group assigned to it).

▪	The Advanced Sale Item Lookup function (accessed with Alt+F2 from with the Sale-Purchase Item Drop-Down Selection List on Sales, Proposals and Purchases Forms) lets you pick from items only in a specific group - thereby presenting a much shorter list.

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•	Click the Save (<) Icon on the Image tab to record this entry.

□	Other Job Costing and Service Department related considerations:

•	Once you've Set up a Job in the Inventory Tracking & Job Costing module, you will often incur Non-Inventory Expenses for the Job.

•	These type of Non-Inventory Expenses are identified with a Job Cost Category

•	As you define your Sale-Purchase Items, if your Job Costing System is active, you will - as needed - enter the Job Cost Category for the item by using the Drop-Down Selection List provided.

•	The Job Cost Category field is not available when you are defining an actual Inventory Item or Kit.

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Job Cost Categories section for Purchase Categories which are Inventory Items

•	The field is Gray - as in the example Inventory Item in the illustration below - because Inventory usage is tracked separately and automatically.

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Note: If using the Commission Tracking System and charging an Activation Fee (defined as part of a Proposal Package), the individual Inventory Items - which will be included in a Proposal Package - should have Commission Points assigned but should not have Labor related information defined (because Labor is included in the Activation Fee - see below).

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•	The Non-Inventoried Job Cost Categories are:

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Job Cost Categories

•	Expense Category options and their purpose are:

a)	Commissions - Identifies this Purchase Category as a Sales related Commission charged against a Job

o	This Commissions Job Cost Category will usually not have Labor component defined.

b)	Expense - Identifies this Purchase Category as a miscellaneous Expense charged against a Job

o	This Expenses Job Cost Category will usually not - but may - have a Labor component defined.

c)	Labor - Identifies this Purchase Category as a miscellaneous Labor (Technician's Labor costs) charged against a Job.

o	This Labor Job Cost Category will almost always have a Labor component defined

d)	Materials - Identifies this Purchase Category as charges for various Material used for a Job (such as wire, batteries, other electrical supplies, conduit, clamps, etc.).

o	This Materials Job Cost Category will usually not - but may - have a Labor component defined

e)	Subcontractor - Identifies charges of Subcontractor bills that will be charged against a Job (such as telephone line installations, pre-wiring, CCTV, independent alarm installer, etc.).

o	This Subcontractor Job Cost Category will usually not - but may - have a Labor component defined.

•	Where appropriate, enter Labor information:

•	If this Purchase Category is an Inventory Item:

o	Labor Hours - ("Lbr. Hours") - This field is used to define - when this is an Inventory Item - the average number of Labor hours that are required to install this Part.

o	Cost Labor Rate - ("Cost Lbr. Rate") - This field is used to define - when this is an Inventory Item - the average internal Cost for each hour required to install this Part.

o	Retail Labor Rate - ("Retail Lbr. Rate") - This field is used to define - when this is an Inventory Item - the average Retail Charge for each hour required to install this Part.

►	Note: If this Inventory (Sale-Purchase) Item is included in a Proposal and subsequently converted to a Job, the Retail Labor Rate information is included in the Job Estimate tab.

•	If this Purchase Category is not an Inventory Item:

o	Labor Hours - ("Lbr. Hours") - This field is used to define the average number of Labor hours that are required for the designated Job Cost.

o	Cost Labor Rate - ("Cost Lbr. Rate") - This field is used to define the average internal Cost for each hour required for the designated Job Cost.

o	Retail Labor Rate - ("Retail Lbr. Rate") - This field is used to define the average Retail Charge for each hour required for the designated Job Cost.

•	Click the Save (<) Icon to record this entry.

□	In addition to the Edit View tab, there are two other tabs on the Sale-Purchase Items Form that are related to Inventory Items:

•	Price Override tab - As shown in the illustration below, the Price Override tab is used to enter a different set of Pricing Mark Up/Down Percentages for previously defined Pricing Mark Up Groups, as appropriate.

•	These Price Overrides are implemented on Proposals and Sales Invoices when the Prospect or Subscriber has a Pricing Mark Up Group assigned, and this specific Sale-Purchase Item is added to the Proposal or Sales Invoice.

•	The Price Overrides tab will display the number of entries within the tab.

•	Once these Price Overrides are defined, as a Sale-Purchase Item is added to a Proposal or Sales Invoice, if that Prospect or Subscriber has been assigned to a Pricing Mark Up Group, the User will be asked if they want to use the Price Override value.

▪	If the User answers Yes, the Price Override value will be applied.

▪	If the User answers No, the Pricing Mark Up Group will be applied.

•	To define a Price Override:

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Price Overrides tab on Sale Purchase Items Form

1.	Click Add ("+").

2.	Group - Using the Drop-Down Selection List provided, Choose one of the previously defined Pricing Mark Up Groups.

3.	Percentage - Enter the Override Mark Up/Down Percentage Rate - as a positive or negative value - indicating that the regular Retail Price entered for this Sale-Purchase Item should be increased or decreased respectively, as described in the Pricing Mark Up Groups chapter.

4.	Save - Click the Save ("ü") button to record this Price Override.

•	Image tab - As shown in the illustration below, the Image tab is used to enter a picture of the Sale-Purchase Item, when appropriate.

•	By using this Image tab to identify an Inventory Item or Kit, it provides the User access to an actual picture of that Part.

•	Images attached to a Sale-Purchase Item record my also be included on a printed Proposal based on the options selected when Printing a Proposal.

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Sale Purchase Items - Image tab

•	To insert an Image:

1.	Choose - Click the Choose button and, using the standard Windows® dialogue box provided, locate the desired file.

o	This should be a BMP or JPG file approximately 5 x 5 inches at 72 ppi.

2.	Image Adjustment - Once the Sale-Purchase Item's BMP or JPG file is selected, Choose the Image Adjustment method that best displays your Sale Purchase Item in the display box by alternately Clicking Show Image At Actual Size and Stretch Image To Fit.

3.	Save - Click the Save button once you are satisfied with the Image Adjustment setting.

o	Once an Image has been saved for a Sale-Purchase Item, the Image tab will have a Camera Icon next to it (see the mouse pointer in the illustration above).

4.	If you want to re-do this process, Click the Clear button and repeat the steps above.

•	Click the Save (<) Icon on the Image tab to record this entry.

□	Understanding the Inventory related Special Icons:

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•	Vendor Item ID - Because you are also using the Accounts Payable System and its Purchase Order capability, you will want to define the Part Number used by each of the Sale-Purchase Items from whom this Inventory Item is ordered.

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Vendor Item ID dialog accessed from the Sale-Purchase Items Form

•	Vendor Item ID - Click the Vendor Item ID Icon to open the Vendor Item ID dialog.

▪	Click Add ("+").

▪	Vendor - Use the Drop-Down Selection List to Choose the Vendor whose Part Number you are entering.

▪	Vendor Item ID - Enter the Part Number used by this Vendor to identify the selected Sale-Purchase Item.

▪	Last Purchase Price - This is a system maintained field.

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▪	Click Save ("ü") to record the entry.

▪	Repeat this process until you've identified the Part Number used by each of the Vendors from whom this item is purchased.

▪	To return to the Sale-Purchase Items Form, Click the Close button on this Form.

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•	Proposal Description - Click the Proposal Description Icon at the top of the Form to create a longer and more detailed description of this Inventory Item.

•	The expanded description entered here will be printed in addition to the Description field information (described above), on all Proposals containing this Inventory Item.

•	Warehouse Inventory - Accessing the Warehouse Inventory Form (See the Warehouse Inventory chapter for complete information about using the Warehouse Inventory Form)

•	To see the current status by Warehouse of the currently displayed Inventory Item, Click the Warehouse Inventory Icon on the Navigation Menu of the Sale-Purchase Items Form to display the Warehouse Inventory Form.

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Warehouse Inventory

•	Warehouse - column showing the places defined as Warehouses.

•	Location - To enter the specific Location within this Warehouse

▪	Click the Ellipse button (to the right of the Location field).

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▪	Enter a specific Location where this Inventory item is stored within the selected Warehouse.

▪	Click OK to record this entry.

•	Status Line - row (next to the Warehouse column) displays a series of columns with the current status (counts) of this Inventory Item.

□	Special Icons on the Warehouse Inventory Form:

•	Click the Warehouse Information Icon to view this form.

•	These buttons provide special Inventory Related functions for the Inventory Tracking & Job Costing System.

•	Adjust - Edit Warehouse Inventory Values - Allows you to (Re-)Set the rules for Reordering Inventory items, and to adjust actual counts based on the results of a physical Inventory Counting process.

•	See the Editing Warehouse Levels chapter for complete information about making Inventory Count Adjustments.

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Edit Warehouse Inventory Values

•	Click on the Inventory Count field(s) to be revised.

▪	'Max Level' Value: - The maximum number of this Inventory Item that should be in-stock (Available 'On Hand') at any time.

▪	'ReOrder' Value: - The number of this of this Inventory Item which is in-stock (Available 'On Hand') that triggers a Re-Order Request (documented in the Inventory Reorder Report).

▪	Available 'On Hand': - The number of this Inventory Item that is in-stock at any time.

▪	Available 'Pending': - The number of this of this Inventory Item which has been ordered but is not already committed to a Job, but has not be received (Also see Reserved Inventory and Purchase Orders).

•	Adjust these numbers, as required.

•	For General Ledger System Users only:

▪	Department - Use the Drop-Down Selection List to Choose the Department that normally uses this Inventory Item.

•	Authorization - Enter the Reason for Change

•	Click OK to save the change or Cancel to abort the revisions.

•	Transfer Inventory - (See the Transfer Inventory chapter to complete information on how to move Inventory from one Warehouse to another))

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Warehouse Transfer Form

•	Moving Inventory Item(s) from one Warehouse to another.

•	Sale Item - The Inventory Item you want to relocate.

•	From - Click the Warehouse Search Icon to locate the appropriate Warehouse Location FROM which to move this item from.

▪	Search By - Use the Drop-Down Selection List to Choose the search method which may be by Name or by Warehouse ID number.

▪	Search Value - Enter the characters with which to perform the search.

▪	Click on the desired Warehouse.

▪	Click the OK button to close the Warehouse Search dialog which will also insert the selected record into the From field.

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Warehouse Search dialog

•	To - Click the Warehouse Search Icon to locate the appropriate Warehouse Location TO which to move this item.

▪	Search By - Use the Drop-Down Selection List to Choose the search method which may be by Name or by Warehouse ID number.

▪	Search Value - Enter the characters with which to perform the search.

▪	Click on the desired Warehouse.

▪	Click the OK button to close the Warehouse Search dialog which will also insert the selected record into the TO field.

•	Quantity - Enter the Quantity to be Transferred. The default value will be 1.

•	Transfer - Click the Transfer button to execute the move.

•	Close - Click the Close button to exit the Form.

•	Hide 0 Vaues - Click the Hide 0 Values button to eliminate all Inventory Items, with no values in any columns, from the Warehouse Inventory display.

•	Show All Values - If the Hide 0 Vaues has been Clicked, the button name changes to Show All Values, which may be Clicked to do just that.

•	Refresh - updates the displayed on the Form to the most current information (in case another person made a change since you opened this Form).

•	Close - Click the Close Icon to close the Warehouse Inventory Form.