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Warranty Inventory Control
Another facet of the parts distribution business to be controlled is the Warranty function caused by product malfunction or premature failure. This permits product returns with and without replacement or exchange. When an item is returned within the warranty period, this ongoing accumulation of broken parts will create an administrative problem within the Accounting department. The AutoPower system provides software that removes this accounting headache, while facilitating the return of goods from the distributor back to the manufacturer.
The Order Entry system will permit the return of product with a defect or warranty claim giving the customer proper credit for the defective part. As the part is received via the Order Entry system, the Quantity-on-Hand for the part is not adjusted, however, the part is added to a special accounting file that will maintain all defective parts. At the proper time, the Warehouse Manager will need to collect up all defective parts for return to the appropriate supplier. At that time a report can be printed by the Accounting department that will list, by product line, all defective parts with the quantity to be pulled from the bins in the defect storage area.
As the defective parts are staged for shipment back to the supplier, a clerk will prepare a formal return list that will accompany the parts to the supplier. This Warranty Returns Report will also print the total value of the defects so that Accounts Payable can anticipate a credit from the supplier's Accounting department.
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