Some stock may have a fast turnover or short shelf-life, e.g. dairy or vegetables, so you don’t want to carry stock for these items. They will be set as non-physical. But you do want to recognise the cost to purchase, because you still buy these products, even though they are marked as non-physical.
Jiwa can recognise cost of goods sold at the time of purchase on these items. It’s still a stock item so we still receive these items on a GRN and enter a supplier purchase invoice. Don’t use Creditor > Purchases > Purchases.
To set up:
Turn on system setting ‘Post Non Physical Items To Inventory Value and COGS’
System Settings > System Configuration > Invoicing
Create an inventory classification for the non-physical items and set the Inventory Value account to the Cost of Goods Account, and the Delivered Asset account to the Cost of Goods Sold Account
Create a non-physical inventory item:
Receive in the stock on a GRN
There is no journal at this point because the items are non-physical. No stock records are created.
Create a purchase invoice for the receival
The journal will debit the Cost of Goods Sold account as the inventory value account and credit Creditors.
Sell the stock
The resulting journal will debit Cost Of Goods Sold as the setting is applied (post non-physical to COGS), and also credit Cost of Goods Sold as the inventory value account. The result is nil affect to COGS, the cost has been taken up at time of purchase.