Unit of Measure – Unit Conversion

Software: MoneyWorks accounting software

Assuming you run a hardware shop selling screw, bolt and nut.

As a retailer, you will usually buy goods in a box or carton form and repack it into a smaller unit such as bag or packet form.

How to record this in MoneyWorks?

How does the Unit Conversion works in MoneyWorks?

Assuming you bought 5 boxes of screw, SC100, which contains 1000 screws per box at $200.00 per box. You repacked it into smaller packet of 10 each and price it at $4.00 per pack. However, sometime you may need to sell it as a box form to contractor at a price of $250.00 per box.

First, you create a product item, SC100:

At Buying Info tab:

Buy Price [ 200.00 ] per [ Box ]

Sell in units: [ ea ]

Unit Conversion: Box = [ 1000 ] ea

At Selling Info tab:

Price [ 0.20 ] per [ ea ]

When you purchased 5 boxes of SC100, your stock on hand will show 5,000 ea (5 boxes x 1000 ea).

If you need to see your stock on hand in box form in the item list window, you can add an extra column using the Heading field with calculation as:

StockOnHand * ConversionFactor

Since we converted from a box to 1000 ea, that is 1/1000 = 0.001 box, so the calculation:

StockOnHand * ConversionFactor

= 5000 * 0.001

= 5 boxes

Next, you create a new item SC100-10 (10 as 10 each), this is to repack your item SC100 into smaller packet of 10 each.

In SC100-10, you leave the Buying info as default (you are not going to buy this item), in the Selling Info tab:

Price:  [ 4.00 ] per [ pkt ]

Note: “pkt” as packet.

In the Inventory tab:

  • Check the checkbox for “Manufacture this item according to bill of materials”
  • Check the checkbox for “Auto-Build Whenever necessary”

Under the “Parts used to build ONE of these items…”:

  • Part code: select SC100
  • Qty: 10 (as 10 each of SC100 = 1 pkt of SC100-10)

Lastly, you need to sell SC100 as a box UOM occasionally, so, you need to add one more product item, in this case, we name it as SC100-BOX.

In SC100-BOX, you leave the Buying info as default too (you are not going to buy this item), in the Selling Info tab:

Price [ 250.00 ] per [ BOX ]

In the Inventory tab:

  • Check the checkbox for “Manufacture this item according to bill of materials”
  • Check the checkbox for “Auto-Build Whenever necessary”

Under the “Parts used to build ONE of these items…”:

  • Part code: select SC100
  • Qty: 1000 (as 1000 each of SC100 = 1 BOX of SC100-BOX)

Assuming you have a customer purchased 2 boxes and 3 pkt of SC100 from you. In your Sales Invoice transaction, you select:

2 x SC100-BOX

3 x SC100-10

Now your stock on hand for SC100 will be left with 2,970 each. This is due to:

2 x SC100-BOX = 1000 each per box x 2 boxes = 2000 each

3 x SC100-10 = 10 each per pkt x 3 = 30 each

Total deduction = 2030 each

So, the original stock on hand of 5000 each less off 2030 each will be equal to 2,970 each.

When using Unit Conversion, always break down the purchase unit into the smaller selling unit.

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