Posting of Receipts/Invoices/Payments

purchasing-general-ledger-flow.md

• Goods Received Before Invoice:
  • Goods Received:
    • Accrual Entry
      • Debit the asset Interim Inventory Accrual
      • Credit the liability Inventory Received Not Invoiced
  • Invoice Received:
    • Reversing the Accrual Entry:
      • Debit the liability Inventory Received Not Invoiced
      • Credit the asset Interim Inventory Accrual
        • This reversing entry cancels out the initial accrual
    • Inventory Entry:
      • Debit the asset Inventory (of a particular flavor)
      • Credit the expense Direct Cost Applied (of a particular flavor)
    • Purchase Entry:
      • Debit the expense Purchase Account (of a particular flavor)
      • Credit the liability Accounts Payable (of a particular flavor)
  • Payment:
    • Debit the liability Accounts Payable (of a particular flavor)
    • Credit the asset of a Cash or Bank Account (of a particular flavor)
• Invoice Received Before Goods:
  • Invoice Received:
    • Accrual Entry:
      • Debit the asset Inventory Invoiced Not Received
      • Credit the asset Interim Inventory Accrual
  • Goods Received:
    • Reversing the Accrual Entry
      • Debit the asset Interim Inventory Accrual
      • Credit the asset Inventory Invoiced Not Received
    • Inventory Entry:
      • Debit the asset Inventory (of a particular flavor)
      • Credit the expense Direct Cost Applied (of a particular flavor)
    • Purchase Entry:
      • Debit the expense Purchase Account (of a particular flavor)
      • Credit the liability Accounts Payable (of a particular flavor)
  • Payment:
    • Debit the liability Accounts Payable (of a particular flavor)
    • Credit the asset of a Cash or Bank Account (of a particular flavor)
• Goods Received and Invoiced at Same Time
  • Goods and Invoiced and Received
    • Inventory Entry:
      • Debit the asset Inventory (of a particular flavor)
      • Credit the expense Direct Cost Applied
    • Purchase Entry:
      • Debit the expense Purchase Account (of a particular flavor)
      • Credit the liability Accounts Payable (of a particular flavor)
  • Payment:
    • Debit the liability Accounts Payable (of a particular flavor)
    • Credit the asset of a Cash or Bank Account (of a particular flavor)