Bin card

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Bin card
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Bin card is a document that helps management of stock room. In a retailing business it is normal that large quantity of goods are kept in large stock rooms. Finding what is available and in what quantity would be very difficult without keeping a record of running balance of stock in hand. The bin card is that type of running balance.

Role Of Bin Card

Fig.1. Bin card example

Bin card can contain more information, e.g.: notes about problems with stock item, rules of storage and movement, expiration date, prices, contact to supplier.

Bin card in modern warehouses is replaced by its electronic version. Extensive computer systems help manage goods in warehouse. They collect information about places of storage. They can even be used in automatic or semi-automatic order collection.

Also bin card provides the information as the brand name, quantity and inventory or bin code number(C. Ojugo 2009, p.163).


At the time before computers appeared, bin cards were popular in the storage areas. It looked as a little index card that was set in front of every product or item at the stock. Usually the owner or manager used the bin card at the end of the month to check the quantity of the goods and determine data for the financial statements(T. Jones 2008, p. 190).

Bin cards were created to enable to have the clear vision how many products are and what products are missing. That is possible due to the unique code number that has every product(Cat2 Information & Management Control 2009, p.4).

Bin Card's Functions

At the storehouses bin cards are used for the recording of the quantitative data for the different store items. The issue, balance and receipt of all materials are noted on them(Cat2 Information & Management Control 2009, p.4).

It is usually kept in the bin or on the shelf. Also it can be hung over the rack (bin). Separated bin cards are created for every good in the storehouse . Also it can be when two different materials are set in one place. They record every coming in and coming out of the product. Bin cards are very helpful in a perpetual inventory system. Perpetual inventory – system of inventory, that regularly collect all transaction quantities(incoming and outgoing). That helps to have the record of the actual balance on hand at every moment(Ed C. Mercado 2009, p.65).

Bin cards can also determine the maximum or minimum of inventory levels. That information, that is mentioned at the bin card, supply dependable rates of the inventory use(Ng'ang'a J. 2013, p.33).

The products’ number, written on the bin card, should always be the same as it is in reality. On the example of beverage control system, the main reasons, why bin cards are used at the control procedures, are: “to simplify and standardize beverage control procedures and forms; to facilitate purchasing, storing, requisitioning, and recording of physical inventories; to provide precise numerical product description to be used in inventory and purchasing control systems”(C. Ojugo 2009, p.163).

Difference Between Stores Ledger And Bin Card

Stores ledger – the accounting record, that provide the record of all items that were coming and leaving for the stores. The difference between stores ledger and bin cards: stores ledger provides the record data both: in quantitative and monetary terms. Bin cards include the quantitative details only. They are kept in the cost accounting department (bin card is kept in the stock room). It is similar to the bin card, but also provides the monetary details for the stores. Except this, transactions in bin cards are noted individually, when in stores ledger only summarized transactions are noted.Connecting them together is done for being ensured that the set of records and the balances in bin cards and stores ledger are the same. That makes possible to do the internal check(Cat2 Information & Management Control 2009, p.4).

The differences can appear because of:

  • arithmetical mistakes in calculating process
  • missing some records or mistakes in posting records in one of the document or in both
  • putting the data in the wrong column for that (for example, issues in the column for the receipt)(Cat2 Information & Management Control 2009, p.4).

Bin Card In The Stock Process

The bill of the materials should estimate the quantity of how much of material is required to be finished in some order. Usually it is used when the company practices the job order system, that is created for the production department. The workers send the copy of a bill to the storeroom. There the bin card is checked to understand whether materials are on the order or on hand to be able to cover requirements of the production. In that case if there is not enough of materials – the purchase requisition should increase in instance. However, if there is no lack of materials the influence on the inventory system can be estimated in advance. The main aim of the bill is to have clear vision whether we have sufficient materials or no(J. Hart, C. Wilson, C. Fergus 2012, p.120).

Happens the situation when requisitioned materials should be returned to the storeroom. There should be the report, that explains because of what reason that goods were returned. The storeperson returns the materials first, regulates the bin card and sends the report about the materials, that were returned, to the store clerk. The store clerk returns that amount of the money that was paid(J. Hart, C. Wilson, C. Fergus 2012, p.120).

One-Bin System

In One-Bin System items are always being refilled, even in that situations when only few goods are needed. At periods that are determined, for example, weekly, the inventory increases to the maximum. It differs from the P-Model. Because in One-Bin System items are replenished always, and in the optional replenishment system, the goods are refilled, when inventory used much more than some estimated minimum(P. Sinna, S. Sinna 2007, p.549).

Two-Bin System

Two-Bin System – goods are used from the first bin. The second bin shows the quantity that is bug enough to be able to determine, that there is an ability to refill the stock. In the ideal situation, the amount that is written on the second bin is equal to the re-order point that should be calculated before. At that moment when the supply of the second bin is brought to the first bin, everything changes to refill the second bin. The main secret in the Two-Bin-System is to divide the inventory, so some part of the goods are kept in the reserve, until that moment when the all other items will be used(P. Sinna, S. Sinna 2007, p.549).


Author: Diana Fandul