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Level 2

Decimal drifts posting to COGS (how to increase decimal places)

Hi,

 

Anyone encountered Decimal Drifts when receiving items? For example, I have a braided rope that is 180 meters @ 80.00 / roll with. So meaning the cost per meter is at 0.44444. What I noticed is that, QB only computes that first 2 decimal places, of which there will be a decimal drift of 0.07 which will post to COGS.

 

Is there a way to get rid of these unknown and unnecessary cost in QB preferences? For small items it is okay, but for large items and unit converted items, it is a head ache.

 

Thank you.COGS.PNG Decimal.PNG

Solved
Best answer 10-06-2018

Accepted Solutions
Level 15

Re: Decimal drifts posting to COGS (how to increase decimal places)

@Verano47

 

What I noticed is that, QB only computes that first 2 decimal places, of which there will be a decimal drift of 0.07 which will post to COGS.

 

if .07 is posting to COGS from a bill, that is not wrong

 

What happened is that at some point before the purchase, the qty on hand went negative.

when the item was used, sale or adjustment, and QB posted the present cost to COGS

 

when you bought more, that establishes a new cost, QB compares the now present cost to the sale and if there is a difference, it makes that adjusting entry to bring the cost what was sold when it was not hand, to the current purchase cost

 

In COGS detail this will show as a bill as the source account

 

Average cost for inventory items is always kept to 5 decimals, but when QB displays cost in transactions it shows dollars & cents (two digits)

View solution in original post

4 Comments
Moderator

Re: Decimal drifts posting to COGS (how to increase decimal places)

Welcome to the Community space, Verano47.

 

I want to help figure out why there's an amount of 0.07 in the transaction. However, I need to know if there's any exchange of rates made in the QuickBooks system. I also encourage you to open the transaction with that amount and send us a screenshot. Any additional details you could provide would be a great help.

 

I hope to hear from you soon.

Level 15

Re: Decimal drifts posting to COGS (how to increase decimal places)

@Verano47

 

What I noticed is that, QB only computes that first 2 decimal places, of which there will be a decimal drift of 0.07 which will post to COGS.

 

if .07 is posting to COGS from a bill, that is not wrong

 

What happened is that at some point before the purchase, the qty on hand went negative.

when the item was used, sale or adjustment, and QB posted the present cost to COGS

 

when you bought more, that establishes a new cost, QB compares the now present cost to the sale and if there is a difference, it makes that adjusting entry to bring the cost what was sold when it was not hand, to the current purchase cost

 

In COGS detail this will show as a bill as the source account

 

Average cost for inventory items is always kept to 5 decimals, but when QB displays cost in transactions it shows dollars & cents (two digits)

View solution in original post

Level 2

Re: Decimal drifts posting to COGS (how to increase decimal places)

Thanks @Rustler !

 

Great explanation. So for those who faces the same issues, what I did is that I restrict the "Negative Inventory" in Preferences -> Items & Inventory -> Company Preferences -> Don't Allow Negative Quantities.

 

So far, by doing so, I haven't encountered negative inventories.

 

Cheers!

Level 15

Re: Decimal drifts posting to COGS (how to increase decimal places)


@Verano47 wrote:

Thanks @Rustler !

 

Great explanation. So for those who faces the same issues, what I did is that I restrict the "Negative Inventory" in Preferences -> Items & Inventory -> Company Preferences -> Don't Allow Negative Quantities.

 

So far, by doing so, I haven't encountered negative inventories.

 

Cheers!


Good setting to use, but it is only available in enterprise, wish I had it in premier.

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