In the last blog, “GL Handling of Expensed Additional Cost – I” we saw the GL impact of the Expensed Additional cost when the setup option Create GL Entries for Expensed Additional cost was checked. In this blog let us check in detail the effects when the same option is un-checked.
New Stuff: Tax Setting – Allow Tax In Price
To un-check the option, navigate to PO -> PO Setup -> PO GL Integration
When this option is un-checked, the system does not create a separate GL entry for the expensed additional cost. Consider the same example as in the last blog and let’s compare the difference where we have received an item at a cost of USD 433 from the vendor ‘Chloride System’ and there is an additional cost of SAD of USD 30 on the purchase against vendor ‘Exide Industrial Batteries’. In this scenario, this additional cost is not required to be loaded on Inventory but instead expense out to particular GL account as shown below:
When the receipt is posted, a GL entry would be created which will not have the impact of the expensed additional cost at the time of GRN but only the Inventory account would be debited and the payable clearing account will be credited.
When the additional cost Invoice is raised against vendor ‘Exide Industrial Batteries’, there is no impact on the additional cost clearing account. The ultimate effect is that the vendor control account gets credited and the expensed additional cost account gets debited. The GL effect for the Additional Cost Invoice is as shown below:
In this scenario, there is no impact on the additional cost clearing account. This setting option i.e. Create GL Entries for Expensed Additional cost lets you select when entries should be created for expensed additional cost either during GRN or at the time the Invoices are posted in Accounts Payable. You can select the best option out of the two that suits your business.
Hope this helps!!
1. GL Account History Inquiry in Sage 300 ERP
2. Handling Additional Costs and its Variations in Sage 300 ERP
3. Handling Additional Costs and its Variations in Sage 300 ERP – II
4. Adding Additional Costs to Inventory When They Are Not Know At Time of Receipt in Accpac
5. Link General Ledger Entry to the Original Transaction