Perpetual Inventory for Non-stock Item

Question:

We have enabled Perpetual Inventory in the Company master. Still, in some Purchase Invoice, posting if done in the Expense Account.

Answer: As per the perpetual inventory, when item is a stock item, then only it's value is booked under Stock-in-hand at the time of Purchase. In this case, the posting in the GL Entry for Purchase Invoice will be as follows.


Account	Debit	Credit
Creditors		100
Stock Received but not Billed	90
Tax	10

Perpetual Inventory doesn't apply on the non-stock item, and expense is booked for them as soon as Purchase Invoice is submitted. The posting in General Ledger for in this scenario will look like:


Account	Debit	Credit
Creditors		100
COGS / Other Expense Account	90
Tax	10

Last updated 3 weeks agoWas this helpful?

Submit

Thanks!