Store Record and Accounting System

Last updated on November 24th, 2019 at 12:36 pm

Store Record Methods or Recording Of Materials Received

The following are the important store record methods that are used for keeping records of the various items of store.

1. Bin Card

Bin card is also known as a bin tag or stock card. A bin is a place, rack or cupboard where materials have been kept. Quantitative records of receipts, issues and closing balance of items of store are shown in a bin card. separate bin cards are maintained for each item and are placed in shelves or bins or are suitably hung up as it convenient. The bun gives a description, a code number of material, bin number, maximum and minimum stock level.

2. Two Bin System

In some manufacturing companies, a bin is divided into two parts: a smaller and larger one. The smaller bin stores the quantity equal to the minimum quantity and the larger part stores the remaining quantity. The quantity in the smaller part is not issued so long as the quantity is available in the larger part. New supply is ordered as soon as the larger bin is empty. Thus, the two bin system facilitates a physical review of stock by the storekeeper for the purpose of purchase requisitions.

3. Store Ledger

A store ledger is a record of stocks, both in quantity and value and is maintained by the store accounting section. Store ledger consists of the same column of a bin card, but in addition, there is an amount column, in which the values are entered. Thus this ledger provides information for the pricing of materials issued and the value of materials at any time.

A stores ledger is a manual or computer record of the raw materials and production supplies stored in a production facility. It is maintained by the person responsible for these assets, such as the warehouse manager. A stores ledger is particularly useful for maintaining a perpetual inventory system, since it tracks the current quantity of items on hand. A stores ledger can be used for the following purposes:

• By Auditors, to see how well the company’s inventory records compare to its on-hand quantities.
• By The purchasing staff, to determine when and in what quantities to purchase additional inventory items.
• By The accounting staff, to use as the basis for calculating the ending cost of inventory on hand.

The information listed on a stores ledger can follow one of two formats:

• Unit quantities only. The ledger shows the beginning unit quantity of an inventory or supplies item, plus or minus any subsequent additions to or subtractions from stock. When used for this purpose, the stores ledger may instead be referred to as a bin card.
• Costed quantities. The same as the first format, except that the cost of the items is also listed in the ledger.

The stores ledger may sometimes also contain a “min max” field, in which is recorded the minimum quantity level, below which an order must be placed for additional units. When the on-hand balance drops below the designated minimum level, the purchasing staff is notified to order more goods.

The stores ledger concept is most applicable to record keeping systems that are entirely manual. The term is rarely used when a business has converted to computerized record keeping systems.