Question:
Why is the “Total Cost” in the Inventory Log Report not matching the “Total Cost” listed in the Invoice Report?
Answer:
If there is a discrepancy between the “Total Cost” of the Invoice Report and the “Total Cost” of the Inventory Log Report (when filtered by Invoice Received date), it could be due to the fact that the Inventory Log Report stores from the point in time cost of the invoice was received, while the Invoice Report will reflect an updated invoice cost when the cost of an item is changed, even if the cost change happened outside of the filtered date of the invoice report. Treez uses two primary cost metrics in its invoices: Total Cost and Total Cost Changed.
Total Cost represents the base cost entered on the invoice before any vendor discounts are applied, while Total Cost Changed reflects the cost after applying vendor discounts. These metrics provide flexibility in inventory valuation, depending on whether pre-discount or post-discount values are preferred. Additionally, vendor discounts are allocated across all line items on the invoice, which can result in discrepancies between reports depending on whether the discount-adjusted cost or the original cost is being referenced.
For example, Product X’s “Total Cost” is showing as $0.50 on the Inventory Log Report, but the Invoice Report is showing $0.05. Both reports run for the same time period, 1/1/23 - 1/31/23. Investigation reveals that the package was received in January with total cost of $0.50 but the cost was then edited on 2/1/23 to reflect total cost of $0.05.
Another example to consider: An item is received with a base cost of $1,200, which is later updated to $1,000. A $200 vendor discount is applied, resulting in a balance due of $800. In this case, the Inventory Log Report will show the original base cost of $1,200, while the Invoice Report and Valuation Report will reflect the revised base cost of $1,000.
Even though the reports were run for the month of January and the change was made in February, the Invoice Report shows the updated cost, while the Inventory Log Report remains unchanged from its point in time “Total Cost” when it was initially received.