Thursday, 1 February 2007

Expected Cost Posting (Interim)

If the Expected Cost Posting to General Ledger option has been activated, Navision will post the Expected Cost to G/L when quantity part of inventory is posted. This option can be activated at Administration --> Application Setup --> Warehouse --> Inventory Setup.

For example, when user post a warehouse receipt for an item, Navision will post the expected cost to the Inventory Account (Interim) and Invt. Accrual Acc. (Interim). The cost is considered as expected because it is not invoiced. When the invoice is received and posted, Navision will reverse out the entries in the 2 interim accounts and post to the actual Inventory Account. Therefore, the G/L entries will looks as follows:

Post Warehouse Receipt
1) Credit Invt. Accrual Acc. (Interim)
2) Debit Inventory Account (Interim)

Post Invoice
1) Debit Inv. Accrual Acc. (Interim)
2) Credit Inventory Account (Interim)
3) Credit Direct Cost Applied Account
4) Debit Inventory Account

During sales, Inventory (Interim) and COGS (Interim) are involved.

Post Shipment
1) Credit Inventory (Interim)
2) Debit COGS (Interim)

Post Sales Inovoice
1) Debit Inventory (Interim)
2) Credit COGS (Interim)

3) Credit Inventory
4) Debit COGS

When you post Production Journal, there are 2 types of entries will be posted - Consumption and Output

Post Consumption
1) Credit Inventory
2) Debit WIP

Post expected output cost
1) Credit WIP
2) Debit Inventory (Interim)

Run Adjust Cost - Item Entries batch job
1) Debit WIP
2) Credit Inventory (Interim)
3) Credit WIP
4) Debit Inventory
If there is any indirect cost, will be transferred to Inventory account as well
5) Credit Indirect Cost
6) Debit Inventory

Adjustment, revaluation, rounding or transfer will all go to Inventory Adjustment account
1) Debit / Credit Inventory
2) Credit / Debit Inventory Adjustment

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