When the Parameter is set to “YES”, the program will use the cost of the wine in the Vessel to do the following entry to the General Ledger when the Bulk Despatch is updated:
Debit: Bulk Despatch Clearing
Credit: Stock Control
The Sales Invoice will use the cost on the Stock Item and do the following entry in the General Ledger when it is updated:
Debit: COGS
Credit: Bulk Despatch Clearing

The cost on the Stock Item is the weighted average cost of the wine in all Vessels as the cost of the wine can be different from one Vessel to the next. This is caused by the different winemaking operations performed on a Vessel. It is then possible that the cost of the wine in the Vessel, used for the sale, are more or less than the weighted average cost on the Stock Item. This will cause a balance to be left on the Bulk Despatch Clearing account after both transactions were updated.

A Journal can be processed to allocate the amount left on the Clearing account. If you want to prevent the processing of Journals, set your COGS account to be the Bulk Despatch Clearing account.

Suggestion: If you have a large variance in the cost of a Variety coming from different Regions, we suggest you create a separate Bulk Wine Stock Item for each Region. The cost price on the Vessel and the Stock Item will be very close to be the same. This will prevent big variances between the Invoice and Bulk Despatch cost entry.

You may experience the same problem in cases where a Cost Allocation is done to move cost from Pressings to Free Run. We suggest that you create separate Stock Items for Pressings and Free Run where costs are allocated.

When the Parameter is set to “NO”, the program will use the Standard Cost on the Stock Item for both the Bulk Despatch and the Sales Invoice.