Adding Categories

Use the Categories form to create categories for your Inventory Control system.

You must add categories before you can add items to Inventory Control. You assign a unique name of up to six characters, called a category code, to each category you create. If you do not group your inventory items, you can set up one category code and assign it to all items. Category codes can contain upper-case letters and numbers.

You can override the category when you ship an item, and you can change the category assigned to an item record at any time. For example, on a shipment you could specify the category as "sample" to deal separately with costs and revenues for goods shipped out as samples.

You cannot delete a category if it is assigned to any items.

Integration with general ledger. For each category, you must enter general ledger account numbers for the four following accounts (Sage ERP Accpac Order Entry uses the Sales account and Returns account — Inventory Control does not use them):

• Sales. A revenue account which Order Entry credits with the revenue from goods sold.

• Returns. A revenue contra account which Order Entry debits to record the reduction of revenue caused when previously sold goods are returned or credit notes are issued.

• Cost of Goods Sold. An expense account which Inventory Control automatically debits with the cost of goods sold, and credits with the cost of goods returned.

• Cost Variance. An expense account in which Inventory Control records the cost variance between the actual cost and either the standard cost (for items using the standard costing method) or the most recent cost (for items using the most recent costing method) of inventory items sold.