ACCOUNTS PAYABLES

Material Receipt:
1. On entry of PO:
No accounting impact.
2. Material receipt
Receiving accrual Dr
AP accrual Cr.
3. On completion of inspection
Inventory Dr.
Receiving accrual Cr.
4. On entering invoice in AP and matching it to receipt
AP Accrual Dr.
Accounts payable Cr.
5. On payment
Accounts payable Dr.
Cash clearing Cr. (if clearing is enabled)
Cash Cr. (if clearing is not enabled)
6. On clearing
Cash Clearing Dr.
Cash Cr.
Debit and Credit Memo :
Debit Memo/ Credit Memo:
Accounts Payable A/c Dr.
To Expense A/c
Standard Invoice:
AP Accrual A/c Dr
To Accounts Payable A/c
Payment against Invoices and DM/CM:
Accounts Payable A/c Dr
To Cash Clearing A/c
Reconciliation Entry in Cash Management:
Cash Clearing A/c Dr
To Cash A/c
Prepayment to Supplier/Employees :

Prepayment Invoice:
Prepaid Expense A/c ...Dr
To Accounts Payable A/c
Payment against Invoice
Accounts Payable A/c Dr
To Cash Clearing Ac
Reconciliation in Cash Management:
Cash Clearing A/c Dr
To Cash A/c
Standard Invoice:
AP Accrual A/c Dr
To Accounts Payable A/c
Apply payment against Invoices:
Accounts Payable A/c Dr
To Prepaid Expenses
Petty Cashier Transactions:
Prepayment Invoices:
Prepayment Expenses A/c Dr
To Petty Cashier Liability A/c
Payment against the invoice:
Petty cashier Liability A/c Dr
To Cash A/c
Expense Report:
Expense A/c Dr
To Petty Cashier Liability A/c
Apply payment Against Invoices :
Petty Cashier Liability A/c Dr
To Prepayment Expenses A/c

*** FIXED ASSETS ****

Normal Addition of assets :
Purchasing:
1. When Asset Item is received:-

Receiving Inventory Account Dr

To Inventory A/P Accrual Account Cr
2. When Item is Delivered to Asset:Asset Clearing Account Dr
To Receiving Inventory Account Cr
Payables
1. When Invoice for Asset Item is created :
Inventory A/P Accrual Account Dr
To Account Payable Liability Account Cr
2. When Invoice is paid in Accounts Payable:Account Payable Liability Account Dr
To Bank Account Cr
Entry in Assets:
Assets A/c ...Dr.
To Asset Clearing A/c. Cr.
Depreciation Expense:
Depreciation A/c Dr.
Depreciation Adjustment A/c Dr
To Accumulative Depreciation
Merge Two Assets:
Assets ( A+ B) .Dr
To Asset Clearing A/c (Cost of Asset A)
To Asset Clearing A/c (Cost of Asset B)
CIP Assets:
Payables:
CIP Clearing A/c Dr
To Accounts payable A/c
When we add an asset as CIP assets, then we will have the entry as:
Assets:
CIP Cost A/c DR
To CIP Clearing A/c
For these types of assets, we will not charge depreciation until and unless we
capitalize the assets.
Capitalization will be in two types:
1. Capitalize the asset in the same period in which the asset is added to the

system
2. Capitalize the asset other than the same period, in which the asset is added to
the system.
Capitalized in the same period:
In payable:
CIP Clearing A/c Dr
To Liability account
Asset A/c Dr
To CIP Clearing
Capitalized after closing the period:
Asset A/c Dr.
To CIP Clearing
When we adjusted the regular asset to the CIP Asset:
CIP Cost A/c Dr.
To Asset Clearing A/c
Retirement of Asset:
Receivables:
Receivable A/c ...Dr
To Proceeds of sales A/c
Payables:
Asset Clearing [Cost of Removable] A/c
To payable A/c
Asset:
Accumulated Depreciation Dr.
Proceeds of sales Clearing A/c Dr.
Cost of Removable Gain A/c Dr.
Revaluation Reserve A./c Dr
Net Book Value Retired Gain Dr.
To
To
To
To

Asset Cost A/c

Proceeds of Sale Gain A/c
Cost of Removable Gain A/c
Revaluation Reserve Retired Gain A/c

Normal sale once completed the life of asset

Sale:
Receivables A/c Dr.
To Proceeds for Sale A/c (Revenue)
Cost of removable:
Asset Clearing A/c (Cost of Removable) Dr.
To Liability A/c

Asset:
We sold the asset with profit and the incurred the cost of removable expenses:
Accumulated Depreciation A/c Dr
Cost of Removable (Expense) Dr
Sales Proceedings (Sale) Dr.
To Asset Cost A/c
To Gain on sale of asset
To Asset Clearing A/c (Cost of removable)
We sold the asset with loss :
Accumulated Depreciation Dr
Sale Proceedings Dr
Loss on sale of Assets Dr
To Asset Cost A/c
Scrap Sale:
Accumulated Depreciation A/c Dr
Cost of Removable (Expense) Dr
Sales Proceedings (Sale) Dr.
To Asset Cost A/c
To Gain on sale of asset
To Asset Clearing A/c (Cost of removable)
We sold the asset (Scrap) with loss
Accumulated Depreciation Dr
Sale Proceedings Dr
Loss on sale of Assets Dr
To Asset Cost A/c
Added additional features when asset value is Zero:
Asset Clearing account Dr.
To Liability A/c
Asset Cost A/c Dr.
To Asset Clearing Account
Depreciation A/c Dr.
Depreciation Adjustment A/c Dr
To Accumulative Depreciation
*** ACCOUNTS RECEIVABLES ****
For Invoices and Debit Memos
Receivable A/c Dr.
To Revenue A/c
For Invoice adjustment which increases the invoice amount

Receivables A/c Dr
To Adjustment A/c
For Invoice adjustment which decreases the invoice amount
Adjustment A/c Dr
To Receivable A/c
For Deposit:
When you enter an Invoice :
Receivables (Deposit) A/c Dr.
To Unearned Revenue (Liability Account)
When you enter an Invoice against the Deposit
Receivables (Invoice) A/c Dr.
To Revenue A/c
Unearned Revenue A/c Dr.
To Receivables (Invoice) A/c
When cash is received against the Deposit
Cash A/c Dr
To Receivables (Deposit) A/c
Goods are issued with a Guarantee:
When you enter a Guarantee:
Unbilled Receivable A/c Dr.
To Unearned Revenue A/c
When you enter an invoice as against the Deposit:
Receivables (Invoice) A/c ..Dr.
To Revenue
Unearned Revenue A/c Dr
To Unbilled Receivable (Invoice) A/c
Bills in Advance :
Receivable A/c ..Dr
To unearned Revenue
Unearned revenue A/c Dr.
To Revenue A/c
Bills in arrears:
Unbilled receivable A/c Dr
To Revenue A/c

Receivables A/c Dr
To Unbilled Receivables A/c
Apply Receipt to Invoice :
Cash A/c Dr
To Receivable A/c (Invoice)
Standard Reversal :
Receivable (Invoice) A/c Dr
To Cash A/c
Debit Memo Reversal :
Reversal (Debit Memo) A/c Dr
To Cash A/c
Standard Receipt :
Cash A/c Dr
To Receivables/ Un applied/ on-Account/ Unidentified
Receipt with discount based on payment Terms:
Cash A/c Dr.
To Receivable A/c
Earned/Unearned Discounts A/c Dr.
To Receivables A/c
Receipts and Adjustments :
Cash A/c Dr.
To Receivable A/c
Write-Off A/c Dr.
To Receivables A/c
Receipt that requires Remittance:
Enter Receipt:
Confirmation Dr
To Receivable A/c
Remit Receipt :
Remittance Dr
To Confirmation
Clear Receipt
Cash A/c Dr
To Remittance
Apply Receipt to Invoice :
Cash A/c Dr
To Receivable A/c (Invoice)

Standard Reversal :
Receivable (Invoice) A/c Dr
To Cash A/c
Debit Memo Reversal :
Reversal (Debit Memo) A/c Dr
To Cash A/c
Standard Receipt :
Cash A/c Dr
To Receivables/ Un applied/ on-Account/ Unidentified
Receipt with discount based on payment Terms:
Cash A/c Dr.
To Receivable A/c
Earned/Unearned Discounts A/c Dr.
To Receivables A/c
Receipts and Adjustments :
Cash A/c Dr.
To Receivable A/c
Write-Off A/c Dr.
To Receivables A/c
Receipt that requires Remittance:
Enter Receipt:
Confirmation Dr
To Receivable A/c
Remit Receipt :
Remittance Dr
To Confirmation
Clear Receipt
Cash A/c Dr
To Remittance

P2P Accounting Entries

Actually in P2P application will generate Journal entries from the point of 'Receiving
Goods'..Before tht one it won't create JV...
Note : if anything worng in the following information ..plz correct me...
I) Receiving Accounting
a).for Inventory Item
Receiving Accrual Dr

Cr Inventory AP Accrual A/c.

b).For Expenses Item
Receiving Accrual A/c Dr
Cr Accrued Expense A/c
Delivery Accounting
a).for Inventory Item
Raw Material A/c Dr
Cr Receiving Accrual A/c
b). for Expense Item
Accrued Expense A/c Dr
Cr Receiving Accrual A/c
The reserve for encumbrance account is used when encumbrance accounting is enabled for
SOB. When a Requisition or PO is created then in Oracle Financial there is no accounting
entries. But when you have enabled your encumbrance accounting then system creates
encumbrances accounting enties for PO as well as for Req.
When requisition is created system creates accounting entries as follows :Req Charge Account Dr XXXX
This enrty is not balanced. When this entries is posted in GL then it is autiomatically
balanced by reserve for encumbrance account given in SOB...
The entry after posting will be as follows:Req Charge Account Dr XXXX
To Reserve for Encumbrance Account Cr XXXX
When a PO is auto created with this requisition then REQ encumbrances will be reversed
and PO Encumbrance will be generated. (PO and REQ Encumbrances will be defined in
Financial Option- Encumbrance TAB in Accounts Payable / Oracle Purchasing TAB).....
The entry will be :Generation of PO Encumbrance:PO Charge Account Dr XXXX
To Reserve for Encumbrance Account Cr XXXX
Reversal of Req Encumbrance:Reserve for Encumbrance Account Dr XXXX
To Req Charge Account Cr XXXX
An when PO is matched to Invoice the PO encumbrance is released because it has now
become actual...
If we enter any unmatched invoice in AP then the following entry is created:INV Charge Account Dr XXXX
To Reserve to Encumbrance Cr XXXX

These encumbrance entries are reversed when PO or REQ is cancelled...

These entries generating in PO module are not automaticaly imported to GL we have to
import these journal entries by running the following Program -- Program - Create Journals in
General Ledger.
Encumbrance entries in AP are automatically transfered when payable transfer to GL is run.
===============================================================
II) For Invoice and Payment
a) On entering an invoice
Expense A/c DrTax A/c Dr
Cr AP Liability A/c
b) On making a payment
AP Liability A/c Dr
Cr Cash A/c.
c) On making a payment when cash Clearing account is used
AP Liability A/c Dr
Cr Cash Clearing A/c
d) On reconciling the payment.
Cash Clearing A/c Dr
Cr Cash A/c.
e) on entering Prepayment Invoice
Prepayment A/c Dr
Cr AP Liability A/c
When prepayment applied to any standard invoice
AP Liability A/c Dr
Cr Prepayment A/c
f). On entering any Debit /Credit Memo
AP Liability A/c Dr
Cr Expense A/c
g).on Creating With Holding tax Invoice in Payables
With Holding Tax A/c Dr
Cr AP Liability A/c