Since 2002, I have been adjusting the dollar value of our cost of goods
sold to reduce inventory to what we believe the correct inventory level
should be. Every time, I'm increasing COGS and decreasing Inventory.
Recently since we've become a larger company and face higher levels of
scrutiny I have become more interested in this particular phenomenon. So
I ran a test case, we sold 2 expensive servers to a customer, and I
immediately went into COGS and Inventory to see if the correct figures
were adjusted.
Quantities seem correct
Dollar amounts are not correct.
We sold
2 chassis, Inventory was decremented by 2, but COGS shows only the cost
of one of them
12 hard drives, Inventory was decremented by 12, but COGS does not show
the actual costs of the hard drives we bought, but took costs based on
obviously a FIFO (first in, first out basis),
16 pieces of memory, Inventory was correct, but... nothing shows in COGS!!
There is more, but, the recorded costs for this sale were 9,613.50 and
according to our purchase receipts it actually cost us 12,486.00. So I
was wondering if anyone has seen this before, did we set up some parts
wrong, or use an odd character somewhere that would make COGS react in
this way?
Jeff
--
Jeff Kaminsky
Sr. Accountant
IX Systems
408-943-4100 ext 122
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