(ITR users only)
The Cuts and Mods application allows you to create inventory quantity-on-hand adjustments and update the Average or Replacement cost of the To SKUs in the transaction so that your inventory is properly updated when you cut or modify inventory items (such as a piece of lumber).
A Cut is an event where you cut or divide a single inventory item into smaller (or different) items. The quantity-on-hand of the original item must be reduced, as it has been consumed to create the new items, and the quantity-on-hand of the new items must be increased. For example, consider a 12-foot piece of lumber, which can be sold as a 12-foot piece, or it can be cut into smaller pieces which can then be sold. If the piece is cut, the 12-foot piece no longer exists, so the quantity-on-hand of the 12-foot piece must be reduced. And since there are now additional quantities of the smaller pieces, the quantity-on-hand for these smaller pieces must be increased.
A Mod occurs when an inventory item is transformed into a different item by some process. The quantity-on-hand of the original item must be reduced, and the quantity-on-hand of the new item must be increased. For example, you stock both #1 Grade and Construction Grade lumber. A few pieces of the #1 Grade are left out in the sun, and they degrade. Since they can no longer be sold as #1 Grade, you would use the Cuts and Mods application to deduct the quantity from the SKU used for #1 Grade lumber, and increase the quantity of the SKU used for the Construction Grade.