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August 16, 2016

8/16/2016 09:04:00 PM

Understanding the accounts being used
Expense A/P Accrual Account: This account accumulates the payable accrual for your purchasing installation. This is the account used by Purchasing to accrue your accounts payable liability for expense items.
 Navigation: Purchasing responsibility > Setup > Organizations > Purchasing Options
Inventory A/P Accrual Account: It accumulates the inventory accounts payable accrual for this organization. This is the account used by Purchasing to accrue your payable liability when you receive your items.
 Navigation: Purchasing responsibility > Setup > Organizations > Organizations > in the Other Accounts tab in the Organization Parameters form
Receiving account: This account records the current balance of material in receiving and inspection.
 Navigation: Purchasing responsibility > Setup > Organizations > Receiving Options
Purchase Price Variance Account: This account accumulates the purchase price variance for this organization. The purchase price variance account is usually an expense account. This is the variance that you record at the time you receive an item in inventory, and is the difference between the purchase order cost and an item's standard cost. Purchasing calculates purchase price variance as: PPV = (PO unit price - standard unit cost) X quantity received.
 Navigation: Purchasing responsibility > Setup > Organizations > Organizations > in the Other Accounts tab in the Organization Parameters form.
Invoice Price Variance Account: This account accumulates the invoice price variance for this organization. This is usually an expense account. Invoice price variance is the difference between the purchase order price for an inventory item and the actual invoice price multiplied by the quantity invoiced: Invoice Quantity x (Invoice Price - PO Price) x Invoice Exchange Rate.
 Navigation: Purchasing responsibility > Setup > Organizations > Organizations > in the Other Accounts tab in the Organization Parameters form.
Exchange Rate Gain or Loss Accounts: This account accumulates exchange rate gains or losses for this organization. These are usually expense accounts. Exchange rate gain or loss accounts are used to record the difference between the exchange rate used for the purchase order and the exchange rate used for the invoice.
 Navigation: Purchasing responsibility > Setup > Organizations > Financial Options