Scribd
Upload
164 views7 pages

Unit Price Diff BTW GRPO AP Inv

When there is a price difference between a goods receipt PO and AP invoice for an item, the general ledger accounts used to record the difference depend on the current in-stock quantity. If the quantity is greater than or equal to the invoice, the difference is posted to the stock account. If less, it is split between stock and a price difference account. If in-stock is zero, the full difference goes to price difference.

Uploaded by

vamsivisu
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
164 views7 pages

Unit Price Diff BTW GRPO AP Inv

When there is a price difference between a goods receipt PO and AP invoice for an item, the general ledger accounts used to record the difference depend on the current in-stock quantity. If the quantity is greater than or equal to the invoice, the difference is posted to the stock account. If less, it is split between stock and a price difference account. If in-stock is zero, the full difference goes to price difference.

Uploaded by

vamsivisu
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 7

How price difference between Goods Receipt

PO and AP Invoice is recorded?


Skip to end of metadata
 Created by Lorna Real, last modified on May 09, 2008
Go to start of metadata
Note: 1161697

When creating an A/P Invoice based on a Goods Receipt PO and there is a price difference between the documents,
the G/L Accounts used when posting this difference depend on the current In Stock quantity of the item.

 If the In Stock Qty > = A/P Invoice Qty, then only the Stock Account will be used.      
 If the In Stock Qty < A/P Invoice Qty, the price difference will be split between the Stock and Price Difference
accounts.          
 If the In Stock Qty = Zero, then the entire price difference will be posted to the Price Difference account. 

Let us take this example: 

1. Create a Goods Receipt PO for item 'Apple', 10 units at GBP 1.00 each.
2. Create an A/R Invoice for 2 units. This will now reduce the In Stock to 8 units.

3. Create an A/P Invoice based on the Goods Receipt PO for 2 units, with Unit Cost of GBP 1.25.
As In Stock (8) is greater than the A/P Invoice quantity (2), the Price Difference of GBP .50 is posted to the Stock
Account.
The price difference is computed as:

A/P Invoice Quantity x [A/P Invoice Price - Goods Receipt PO Price]


2 x [GBP 1.25 - GBP 1.00]
GBP 0.50

The price difference has also updated the moving average cost of the item to GBP 1.06333.

4. Create an A/R Invoice for 5 more units. This will now reduce the In Stock from 8 to 3 units.
5. Create an A/P Invoice based on the Goods Receipt PO for 5 units, with Unit Cost of GBP 1.25.
As In Stock (3) is not sufficient to cover the A/P Invoice quantity (5), the Price Difference of GBP 1.25 is posted to the
Stock and Price Difference Accounts.

Stock (GBP 0.75) = GBP 0.25 x 3 Units


Price Difference (GBP 0.50) = GBP 0.25 x 2 Units. 

6. Create an A/R Invoice for the remaining 3 units. This will make the In Stock 0.

7. Create an A/P Invoice based on the Goods Receipt PO for the remaining 3 units, with Unit Cost of GBP 1.25.
As In Stock is currently zero, the entire Price Difference of GBP 0.75 is posted to the Price Difference Account.

You might also like