If the inventory count of the sending store is incorrect, and a part has been requested by another store through Parts Invoice Location transfer, some adjustments must be made to correct the on hand counts and the general ledger accounts.
There are 3 scenarios. Scenarios 1 and 2 are used when there are only two stores. The first describes the steps required if the transfer sales order is NOT invoiced in the sending store; the on hand discrepancy is realized prior to doing an invoice. The second scenario describes the steps required if the transfer sales order in the sending store IS invoiced and then the on hand discrepancy is realized. In the second scenario the accounting transactions of transferring the cost from Location 02 to Location 01 is done. The third scenario is similar to scenario 1 in that the sending store has NOT invoiced the transfer invoice yet, but there is a third store that does have the required parts on hand.
In the following example, Location 01 is requesting the transfer from Location 02. Location 02 has the on hand discrepancy.
Not invoiced yet
1. Location 01 requests a Location transfer from Location 02, Location 02's on hand is incorrect and shows that there is 1 on hand when there really is not.
2. Location 02 just has to add a second line to credit -1 so the net quantity on the transfer invoice is 0 (1 + (-1) = 0).
3. Location 01 will have to receive the part and have Location 02 request a transfer back. Location 02 should subsequently correct their inventory.
Location 02 invoices the transfer
1. Location 01 requests a Location transfer from Location 02. Location 02's on hand is incorrect and shows that there is 1 on hand when there really is not.
2. Location 01 will receipt in the PO from Location 02 so that the quantity is placed in Location 01's on hand.
3. Location 02 will now create a Location transfer from Location 01 to transfer the part back to Location 02. They will use Parts Ordering and create a PO to Location 01 as the vendor.
4. Location 01 will invoice the above ticket to perform the accounting and the on hand count.
5. Location 02 will receive in the part to change their on hand value (Location 02 will have to correct their on hand discrepancy).
6. Location 01 will request the part from another source.
Not invoiced yet but Location 03 has the required parts
Location 01 requests a Location transfer from Location 02, Location 02's on hand is incorrect and shows that there is 1 on hand when there really is not.
Location 02 adds a second line to the transfer invoice credit the ordered parts (-1).
Location 02 adds a third line and force issues the quantity to zero, then orders the part from Location 03 ship direct to Location 01.