Item balance updates also occur when inventory is returned. If the pick was partial, short or complete, the following balances all increase by the quantity of the item actually returned:

• On-hand quantity
• Allocated quantity
• Released requirements quantity
• Total requirements quantity

In order for the released requirements quantity, total requirements quantity and allocated quantity to drop back down to zero, the items must be deallocated and the order must be closed. Then, the 10 chocolate bars will be available to other orders. As a result, the available quantity and the available-to-release quantity will increase by 10.
 

	On-hand  quantity	Total  Requirements  Quantity	Released  Requirements  Quantity	Allocated  Quantity	Available  Quantity	Available-to-  Release  Quantity
Beginning  Balance	0	0	0	0	0	0
Order  Returned	+10	+10	+10	+10
Order  Deallocated  and Closed		-10	-10	-10	+10	+10
New  Balance	10	0	0	0	10	10

 

If an overpick originally occurred when the items were being picked and all of the items that were picked are returned, the on-hand quantity increases by the quantity actually returned. However, the allocated quantity, released requirements quantity and total requirements quantity all only increase by the quantity originally requested. In other words, these item balances increase enough to accurately reflect the quantity originally released and allocated to the order.

For example, suppose only 10 chocolate bars were allocated to the snack bar’s order but 12 were actually picked and shipped. In other words, the chocolate bars were overpicked. The snack bar receives 12 chocolate bars; however, all 12 of them are returned. When the return is recorded in the NCAS, the on-hand quantity at the warehouse immediately increases by 12, but the allocated quantity, released requirements quantity and total requirements quantity only increase by 10. In other words, the on-hand quantity reflects what was physically returned, whereas the other balances only reflect the return of the quantity originally ordered.
 

	On-hand  quantity	Total  Requirements  Quantity	Released  Requirements  Quantity	Allocated  Quantity	Available  Quantity	Available-to-  Release  Quantity
Beginning  Balance	15	0	0	0	15	15
Order  Entered into  the NCAS		+10
Order  Released &  Allocated			+10	+10	-10	-10
Overpick  Posted	-12	-10	-10	-10	-2	-2
Order  Closed
Order  Returned	+12	+10	+10	+10	+2	+2
New  Balance	15	10	10	10	5	5

Again, at this point, the released requirements quantity, total requirements quantity and allocated quantity still reflect an order for 10 chocolate bars. In other words, the chocolate bars are not available to other orders. In order for the released requirements quantity, total requirements quantity and allocated quantity to drop back down to zero, the items must be deallocated and the order must be closed. Then, the 10 chocolate bars will be available to other orders. As a result, the available quantity and the available-to-release quantity will increase by 10.
 

	On-hand  quantity	Total  Requirements  Quantity	Released  Requirements  Quantity	Allocated  Quantity	Available  Quantity	Available-to-  Release  Quantity
Beginning  Balance	15	0	0	0	15	15
Order  Entered into  the NCAS		+10
Order  Released &  Allocated			+10	+10	-10	-10
Overpick  Posted	-12	-10	-10	-10	-2	-2
Order  Closed
Order  Returned	+12	+10	+10	+10	+2	+2
Order  Deallocated  and Closed		-10	-10	-10	+10	+10
New  Balance	15	0	0	0	15	15

You have now learned how item balances in the Inventory module are affected when internal replenishment and usage orders are processed at a warehouse.