Page 251 - Accounting Information Systems

222 PART II Transaction Cycles and Business Processes

FI G U RE
5-5 RECEIVING REPORT

Hampshire Supply Co. No. 62311
Receiving Report

Vendor Jones and Harper Co. Shipped Via : Vendor
Purchase Order No. 23591 Date Received 9/1/09

Part No. Quantity Description Condition

86329 200 Engine Block Core Plug Good
20671 100 Brake Shoes Good
45218 10 Spring Compressors Ear on one unit bent

Received By: Inspected By: Delivered To:
RTS LEW DYT

UPDATE INVENTORY RECORDS. Depending on the inventory valuation method in place, the in-
ventory control procedures may vary somewhat among firms. Organizations that use a standard cost sys-
tem carry their inventories at a predetermined standard value regardless of the price actually paid to the
vendor. Figure 5-6 presents a copy of a standard cost inventory ledger.
Posting to a standard cost inventory ledger requires only information about the quantities received. Because
the receiving report contains quantity information, it serves this purpose. Updating an actual cost inventory
ledger requires additional financial information, such as a copy of the supplier’s invoice when it arrives.

FI G U RE
5-6 INVENTORY SUBSIDIARY LEDGER USING STANDARD COST

HAMPSHIRE MACHINE CO.
Perpetual Inventory Record—Item #86329
Qnty Total
Item Units Units on Reorder Qnty on Vendor Standard Inven.
Description Received Sold Hand Point Order EOC Number Cost Cost
Engine Block Core
Plug 200 200 30 200 4001 1.10 220
30 170 187
20 150 165