Jay really appreciate the feedback and the highlighting of alternatives. But this last one do not think works in our use case.
We cannot Purchase Invoice against Expense Account as pounds we purchase may not be sold for months and recognition guidelines require us to go to Inventory Account (any way to do!!).
Standard stock item we believe is not workable as we buy many materials from many suppliers at multiple prices per pound. We process with associated weight discrepancies and 1 package ends up with pounds from multiple suppliers purchased at different prices at different times. No Avg Cost, FIFO, LIFO system is going to track that accurately through stock to deduct the right amount when say 1,234 pounds are sold.
We enter each payment to supplier for raw materials in $ as a global number, accounts payable against inventory (we do not even know real quantity at that time as have not processed and weighed). As you indicate Purchase Invoice for stock item accomplishes this in $, but quantity would be wrong!! So eventually after registering many purchases and sales we could end up with negative quantity with positive value and other undesirable situations. The solution is probably to enable some Mfg functionality so received quantity does not have to equal sales quantity, but seems more steps to accomplish than what we do now.
When we sell, we do steps (2 and 3) described in previous post as our external system tracks cost for each pound and knows specific cost for each package (which is different even if they may have same quantity of same material).
We always have discrepancies in inventory account as pounds paid for are not exactly pounds received, plus losses in processing, etc. Twice a year we do a physical and revalue inventory account to what is actually on floor. Variances are normally < 10% of inventory value and < 2% of total COGS for period, so acceptable for us and auditor.
Would love to abandon our home made external system, but have not yet figured our how to use std ERP for our case where there are no standards.
Sorry for long reply.