Managing your stock inventory in Sage One

If you buy and sell products, you need to make sure that you have enough stock available to meet demand. However, you don’t want to hold too much stock as this can be costly and affect cash flow.

With Sage One, you can manage your stock levels to make sure you always have the right quantities available. To do this, you need to create Stock item records. When you buy and sell these items, the number in stock is increased or reduced and the value is recorded.

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Stock item records

Each record holds information about your stock item, including:

Category Used to group similar products together for easier searching and reporting.
Selling Price The price used by default on sales invoices.

You can have up to 10 different selling prices. This makes sure that products are sold to customers using the correct price.

You set these up in the Record and Transaction Settings.
Sales Account The nominal account used to record the sale.

You can set a default for the record but it can be changed per invoice. Setting a default helps to make sure sales are posted to correct accounts.
Purchase price The cost price of the item. This is the price used by default on purchase invoices.
Purchase Account The nominal account used to record the purchase.

We recommend that you use an Asset account from the Balance Sheet. This is so that when you buy the item, it represents an asset to your business. When you sell the item, you need to post a journal to account for the cost and move it to your Profit & Loss.
Reorder level This is shown on the Products & Services list, and helps you to see when items need to be re-ordered.

Stock movements

Information about your stock item levels and values are updated when stock items are added to invoices and credit notes. It’s important that you understand how this works as this is key to making the most of the functions available in Sage One.

Sage One tracks your stock by recording stock movements each time stock is bought and sold. Each stock movement has a type which records whether stock was added or removed.

Transaction type Movement type Details
Sales invoice Goods out The stock level is decreased. This transaction is shown on the stock item’s Activity tab.

Note: You can’t add a stock item to an invoice if you don’t have enough in stock.
Sales credit note Negative Goods Out The stock level is increased as goods have been returned.

This transaction is shown on the stock item’s Activity tab.

Note: If you want to raise a credit for a price change only and not impact stock levels, you should reverse the original invoice in full via a credit note, then raise a new invoice for the correct price.
Purchase invoice Goods In The stock level is increased, and the last cost price and average cost price on the stock item are updated.

This transaction is shown on the stock item’s Activity tab.
Purchase Credit Note Negative Goods In The stock level is decreased as you have returned the goods to the supplier. The last cost price and average cost are also updated.

This transaction is shown on the stock item’s Activity tab.

Note: If you want to raise a credit for a price change only and not impact stock levels, you should reverse the original invoice in full via a credit note, then raise a new invoice for the correct price.
Add stock via an adjustment Adjustments In The stock level is increased. The cost price entered on the adjustment is used to work out the value of the stock movement.

This transaction is shown on the stock item’s Activity tab, and is not posted to your nominal ledger accounts.
Remove stock via an adjustment Adjustments Out The stock level is decreased. The cost of the adjustment is worked out from the cost price set on the stock record multiplied by the quantity of the adjustment. This transaction is shown on the stock item’s Activity tab, and is not posted to your nominal ledger accounts.

When an invoice or credit is voided or edited, this updates the stock transaction to the new value or removes the stock activity when voided.

What are stock adjustments?

These are where you can manually adjust your stock levels to change the number of items you have in stock. You would generally use this to write-off damaged stock, or to adjust quantities after a stock take.

This does not update the nominal ledger accounts.

When you first start using stock items, you can use adjustments to record the number of items you currently have. Your stock levels are then updated each time you add the item to a sales or purchase invoice.

Stock value

As well as keeping track of the number of items you have stock, it’s also important to record the value of your stock. The value of the stock that you hold is usually shown as an asset to your business on your Balance Sheet. When stock is sold it becomes a cost and should be represented on your Profit and Loss as a cost of sale. This is to make sure that your Balance Sheet only reflects the value of Stock that you still hold.

To record this in Sage One, we recommend that:

  • 1. The purchase of stock items are recorded against an Asset ledger account. You can set a default nominal ledger account on the stock record to make sure the purchase of items is recorded correctly.
  • 2. When stock is sold, you transfer the value of sold stock from the Balance Sheet to the Profit and Loss using a journal. If you’re not sure which nominal ledger accounts you should be using, we recommend that you contact your Accountant for advice.

Alternatively, if you want to you can record the purchase of stock to your Profit & Loss. For more information about how to do this, please speak to your accountant or refer to our guide.

How to enter opening stock balances

When you first start using stock in Sage One, you may need to ensure that the value of any stock that you’ve already bought is also represented in Sage One.

  • To make sure stock levels are correct, you need to enter a stock adjustment for the number of items you currently hold for each stock item.
  • To make sure you stock value is correct, enter a journal for the total value of all your stock between your stock account and your suspense account:
Stock (Balance sheet) Debit
Suspense account (Profit and Loss) Credit

Ask your accountant for advice on where this value should be moved to at the end of the year.

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