Inventory & Stock Ledger

The Inventory module tracks perpetual stock levels across warehouse locations, individual storage bins, valuation ledgers, and physical count adjustments.

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Inventory Calculations & Valuation Rules

1. The Stock Availability Equation

Availability is calculated dynamically across warehouse storage bins using a strict pickability whitelist:

Available Stock = Sum(Pickable Storage Bins) - Allocated Committed Stock

• Pickable Bin Whitelist: Stock is only eligible for customer fulfillment if the storage bin meets three conditions:
  1. bin_type is storage, pick, or bulk.
  2. is_unavailable = false (bin is not locked or under maintenance).
  3. is_bonded = false (stock is cleared for commercial release).
• Non-Pickable Bins: Items in quarantine, dock/staging, in_transit, or locked bins are visible in physical On Hand totals but are strictly excluded from Available Stock.
• Committed Stock: Units reserved for Confirmed sales orders, active picking carts, and released In-Progress manufacturing work orders.

2. Perpetual Costing & Valuation Strategies

HeroBM supports two perpetual valuation models:

A. Moving Weighted Average Cost (WAC)

WAC is recalculated immediately whenever inbound goods are received at the dock:

New WAC = ((Current QOH * Current WAC) + (Qty Received * Actual Unit Cost)) / (Current QOH + Qty Received)

• Stored to 4 decimal places to eliminate fractional rounding drift over high-volume transactions.
• COGS at Dispatch: When goods are shipped to clients, the financial ledger posts:

  Debit:  Cost of Goods Sold (COGS)  (Qty Shipped * Current WAC)
  Credit: Inventory Asset Account     (Qty Shipped * Current WAC)

B. Standard Costing & Purchase Price Variance (PPV)

When using Standard Costing, inventory is capitalized at standard cost regardless of the supplier purchase price:

Inventory Value Added = Qty Received * Standard Cost
Purchase Price Variance (PPV) = (Actual Unit Cost - Standard Cost) * Qty Received

• If Actual Cost > Standard Cost, the positive difference debits PPV expense.
• If Actual Cost < Standard Cost, the favorable variance credits PPV expense.

3. Stock Adjustments & GL Impact

Stock count corrections generate immutable entries in the Perpetual Stock Ledger and post directly to the General Ledger:

• Positive Count Adjustment (Surplus Found):

  Debit:  Inventory Asset Account
  Credit: Stocktake Variance Gain / Expense

• Negative Count Adjustment (Shrinkage / Damage / Scrap):

  Debit:  Inventory Shrinkage / Loss Expense
  Credit: Inventory Asset Account

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Step-by-Step Workflows

1. Checking Bin Contents and Availability

1. Go to Inventory → Bin Contents (/inventory/bins).
2. Filter by warehouse facility, SKU, or bin coordinate.
3. Review physical On Hand, Committed reservations, and free Available units.

2. Performing a Stock Adjustment

1. Go to Inventory → Stock Ledger (/inventory/ledger).
2. Click Stock Adjustment.
3. Select the Warehouse, Storage Bin, and Product.
4. Enter the count variance (+/- quantity) and select a mandatory Adjustment Reason.
5. Click Post Adjustment. Perpetual stock balances and GL inventory assets update immediately.

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Field Reference

Field	Description
Warehouse Location	Facility or site where stock is physically situated.
Bin Coordinate	Aisle, rack, and shelf storage location (e.g. A-04-B2).
Bin Type	Functional category (storage, pick, bulk, quarantine, dock).
On Hand	Total physical quantity residing in the facility.
Committed	Quantity reserved for open sales orders and work orders.
Available	Free stock in eligible pickable bins ready for new orders.
Movement Type	Transaction type in the perpetual ledger (RECEIPT, PICK, DISPATCH, ADJUSTMENT).