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If the destination type for the distribution is Inventory, this account will be the Material account associated with the
subinventory and you cannot override it. This is the balance sheet account that will be charged after inventory is capitalized.
If the destination type is expense, you can specify this account (provided it isnt project related) and override any
defaults. This account will be either an asset clearing account that will be included on the balance sheet or an expense
account that will be included on the income statement. This account is either created or specified when you create a
purchase order.
Look at the Material Account on the destination inventory organization, or (if specified), destination subinventory.
Under Inventory: Setup/Organizations/Parameters or Sub inventories
PURCHASE PRICE VARIANCE
This account is used to record differences between purchase order line price and standard cost.
The Purchase Price Variance is calculated when items delivered to inventory are costed.
You should note, this account is not used with the average cost method.
For example, assume the purchase order line price for an item was set at $100 per item but standard cost was set to $120 per item and you
purchased 10 items. The Purchase Price Variance would be $200.
You can specify the Purchase Price Variance account when you define Inventory Information for your inventory organizations in the Other Accounts
tab.
INVOICE PRICE VARIANCE
The variance account used to record differences between purchase order price and invoice price.
This account is used by Payables to record the invoice price variance for inventory items.
For expense items, the account generator uses the charge account to record any invoice price variance.
You can understand with this set of example, how its works;
1). Create a purchase order with expense type item having the above
Navigation: Purchasing->Purchase Orders->Purchase Orders
2). Receive the goods for this PO.
Navigation: Purchasing->Receiving->Receipts
3). Login as Payables manager, create an invoice and match it to the PO created in step 1.
Navigation:Payables->Invoices->Entry-Invoices
for example
PO Quantity=100
PO Price = 5
Now you match an invoice to the PO and Invoice(match) details are as follows:
Matched Quantity=100
Price on Invoice= 1
in this case, probably you have set the Invoice price variance account in define Organization Parameters form( alternate region: other accounts)
same as the expense account on the PO
Invoice Price Variance= (PO Price - Invoice Price) x Qty. Invoiced
You can specify this account when you define Inventory Information for your inventory organizations in the Other Accounts tab.
any pointers on implementing it for Purchasing i.e. for Requisition Account Generator and PO Account Generator would be helpful.
Rgds,
-Kama