Accounting entries for Purchase Receipt & Invoice


Ax 2012 has introduced a major change in the accounting framework for recording the purchase receipts & Invoices. In Ax 2012 the system provides 2 new accounts Purchase expenditure, un-invoiced & Purchase expenditure for product.

Purchase expenditure, un-invoiced – This has been introduced as a control account to offset main account for accrued liability amounts when posting a product receipt. This account is used for both stocked & non stocked items.

Purchase expenditure for product – This has been introduced as a control account to offset main account for liability amounts when posting a vendor invoice. This account is used only for stocked items.

Following entries are passed when posting a Purchase Packing slip

  •  Entry to accrue liability:

Purchase expenditure, un-invoiced a/c Dr

To Purchase, accrual a/c

  •  Entry to record the item cost:

Product receipt a/c Dr

To Purchase expenditure, un-invoiced a/c

  Following entries are passed when posting a Purchase Invoice

  •  Entry to reverse the accrual & record the vendor liability:

Purchase, accrual a/c Dr

Purchase expenditure for product a/c Dr

            To Purchase expenditure, un-invoiced a/c

            To Vendor balance (Accounts payable) a/c

  •  Entry to reverse the cost entry created at Packing slip & post a new entry to record the actual cost:

Purchase expenditure, un-invoiced a/c Dr

Purchase, inventory receipt a/c Dr

            To Product receipt a/c

            To Purchase expenditure for product a/c

When observing the entries passed at the Purchase Invoice, it will be clear that the system nullifies the entries in such a manner that the remaining entries are same as what Ax 2009 used to maintain.

Below is the final entry after nullifying the above entries:

Purchase, inventory receipt a/c Dr

            To Vendor balance (Accounts payable) a/c

 

Happy Learning.!

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