In the NCAS, items can be issued to customers by filling online requests, known as usage orders, or over-the-counter requests, known as direct issues. A warehouse can issue items at the current average cost or a warehouse can mark up the items at the time of issue. Inventory mark up is referred to as storage overhead in the NCAS.

When customers return inventory to the warehouse, the item can be returned through the original usage order or it can be directly returned. In addition, similar to internal replenishment transactions, the NCAS also permits both intracompany and intercompany issues.

The Accounting for Inventory Issues subsection will explain the following topics:

• how storage overhead is established and calculated in the NCAS
• the accounting implications of usage order issues and returns
• the accounting implications of direct issues and returns
• the accounting implications of intercompany issues and returns