Open Forum

 View Only
  • 1.  Price Variances

    TOP CONTRIBUTOR
    Posted Jan 29, 2021 12:44 PM

    In our main company, I was keying an invoice that had a price variance.  I looked at the Distribution and the variance was hitting the Inventory G/L account.  The Accounting Manager has changed the inventory card to not allow posting except through the inventory module.  I looked at the Vendor's Card, at the Accounts tab.  Price Variances are supposed to go to a COST of GOODS account, COGS-Price Variance. 

    Is there another place with a setting that is not correct, that I should change?



    ------------------------------
    Thomas Hill
    Staff Accountant
    M&A Technology, Inc.
    Carrollton TX
    ------------------------------


  • 2.  RE: Price Variances

    TOP CONTRIBUTOR
    Posted Jan 29, 2021 12:52 PM
    Check Inventory > Cards > Item Purchasing Options Maintenance > Revalue Inventory for Cost Variance. Also, Purchase Price Variance GLs are set on the Item as well.

    ------------------------------
    Matthew Arp
    Business Systems Developer
    Hunton Group
    Houston TX
    ------------------------------



  • 3.  RE: Price Variances

    TOP CONTRIBUTOR
    Posted Jan 29, 2021 02:28 PM

    Thank @Matthew Arp I do not want to do any re-valuing for the item(s).  I just want the difference to go to the Purchase Price Variance, not to inventory.  My inventory is too vast to pull up individually.  But I am not seeing what you noted.  We are on GP2015-R2.

    Inventory > Cards > Item Purchasing Options [stops there]

    I get this screen, which has nothing for price variances


    I pulled up an inventory item in card (actually six different ones) and the Accounts should Purchase Price Variance hitting the COGS section, not inventory.  The item I noticed the issue was setup so that Purchase Price Variance would go to COGS, not Inventory.

    ​​​



    ------------------------------
    Thomas Hill
    Staff Accountant
    M&A Technology, Inc.
    Carrollton TX
    ------------------------------



  • 4.  RE: Price Variances

    TOP CONTRIBUTOR
    Posted Jan 29, 2021 02:39 PM
    It's the bottom checkbox. Revalue Inventory for Cost Variance. In theory if that is checked and the item is still in your inventory, Enter/Matching an invoice to an inventory receipt with update the associated cost of it in inventory. If the item was no longer in inventory it would just hit PPV. If it is unchecked, the variance would go to the PPV account setup.

    ------------------------------
    Matthew Arp
    Business Systems Developer
    Hunton Group
    Houston TX
    ------------------------------



  • 5.  RE: Price Variances

    TOP CONTRIBUTOR
    Posted Jan 29, 2021 02:52 PM
    So IF I am understanding correctly, when I am entering the invoice to match to purchase orders, if there is a price variance AND I want it to go to COGS then the inventory items have to have THAT box unticked.  Otherwise it will go to inventory.

    ------------------------------
    Thomas Hill
    Staff Accountant
    M&A Technology, Inc.
    Carrollton TX
    ------------------------------



  • 6.  RE: Price Variances

    TOP CONTRIBUTOR
    Posted Jan 29, 2021 02:58 PM
    Correct, if that box is checked, and the item is still in inventory then the variance would go to inventory. Otherwise PPV.

    ------------------------------
    Matthew Arp
    Business Systems Developer
    Hunton Group
    Houston TX
    ------------------------------



  • 7.  RE: Price Variances

    TOP CONTRIBUTOR
    Posted Feb 01, 2021 09:27 AM
    @Matthew Arp  Thank you for helping me out.  I appreciate it. ​

    ------------------------------
    Thomas Hill
    Staff Accountant
    M&A Technology, Inc.
    Carrollton TX
    ------------------------------



  • 8.  RE: Price Variances

    Posted Feb 16, 2022 02:57 PM

    This thread is super helpful, thanks @Matthew Arp!  Two more follow up questions: 1) If the box is checked and the variance is set to go to an inventory account, ​will the Historical IV Trial Balance Inventory Activity Report have the updated invoice cost? 2) Does the INV Utility to Adjust Costs no longer need to be updated?  We habitually have problems reconciling the GL to the TB report and I've always assumed it's because our PO=>Receipt cost doesn't match the Invoice cost, but it seems like with some cleanup to the account coding to push to the GL, the TB Item cost will match the cost hitting the GL, correct?  



    ------------------------------
    Kristy James
    Financial Controller
    Dairyland Electrical Industries, Inc
    Stoughton
    ------------------------------



  • 9.  RE: Price Variances

    Posted 6 days ago
    Technically speaking, typically variances are taken to the P&L, reviewed, and capitalized per GAAP.  They can remain on the balance sheet to match your inventory turns.  I would agree that the PPV account is in the COGS portion of the P&L.  The capitalized variance account would be in the 'Inventory' section of the P&L.
    Note: we have just set up the PPV accounts.  I need to find a report that will give me the variance, the sku, the standard cost, and the invoice amount.
    Can anyone help with that?

    ------------------------------
    Mitchell Locklear
    Pioneer Athletics
    Cleveland OH
    ------------------------------



  • 10.  RE: Price Variances

    Posted 6 days ago
    Hi Mitchell, 

    You should be able to create something very close to that using Smart List/Smart View. If you use the Purchase Line Items it already has the unit cost from the transaction (Invoice Amount) and can add Standard Cost, giving you 3 of the 4 fields needed. Adding the variance will be tricky and hopefully someone else chimes in with the correct answer. But it may need to be a combination of things in excel to get exactly what you are looking for. 
    If you use the Landed Cost function built into GP, it is much easier to track the variances.

    ------------------------------
    Matt Pilliod
    Steiner Tractor Parts
    Lennon MI
    ------------------------------



If you've found this thread useful, dive deeper into User Group community content by role