Note on handling Small Tools, Instruments and Fixtures:

One of the requirements of a Manufacturing organization is to handle Small Tools, Instruments and Fixtures. In order to process such items in ERPNext, a new Item Group ‘ST : Small Tools, Instruments & Fixtures’ has been introduced.

All Small Tools such as drill bits, chucks, taps etc., Measuring Instruments like Verniers, Gauges, measuring tapes and Jigs & Fixtures used for manufacturing items including moulds, patterns etc.  required for Production / R&D are to be created with ST Item group. Numbering series will be ST.####.

When the item is received in stores, these items will be accounted under holding stores inventory. These items will have useful life beyond a year for couple of years. As such expense towards it to be amortized over multiple years based on production capacity.

In order to take care of amortizing in accounting, these items have to be issued to concerned cost center through Material issue. Accounting transaction happens by crediting the ‘Stock account’ and debiting the ‘Small Tools & Fixtures’ account.

At the year end closing of accounts, the necessary journal entry should be done to credit Small Tools & Fixtures  and debit Miscellaneous expense account towards the amortized amount for the year.