Purchase Invoice – This is saved in the purchase tables.
Inventory Quantities – The Product On Hand quantity is updated according to the following rules:
- Originated with Purchase Receipt – Inventory is adjusted by any changes to the quantities entered at the receipt.
- Originated here at the Invoice – Inventory is adjusted by the quantities entered here.
In either case, entries to the inventory tables are made recording the quantity in or out.
Product Costs
For the purpose of this section, old amount is the on-hand quantity of product minus any unprocessed Purchase Receipts. The old $ is the previous average cost. The new amount is the entire quantity of that product on this Purchase Invoice and the new $ is (($ Total – discount + freight) / Quantity).
Weighted Average is calculated based on the following formula: ((old amount x old $) + (new amount x new $)) / (old amount + new amount)
- Last Cost – The previous Last Cost is replaced with the new cost. If the new cost price varies from the last cost by more than the tolerance percentage set at Setup / Preferences on the Inventory tab, then a warning appears.
Vendor Balance
- Non-Prepaid – A positive purchase increases the Vendor balance and decreases if negative. If this is the freight vendor as well, the actual freight is included in this figure.
- Prepaid – A positive purchase decreases the Vendor Prepay balance and increases if negative.
- Accounts Payable Unpaid Bill file – An unpaid bill is created if non-prepaid.
- General Ledger – A payable-type Vendor journal entry is made and the G/L account balances are updated.
| Vendor Journal Entry | Debits | Credits |
| Gross figure owed Vendor | Accounts Payable (Vendor's Location) | |
| Purchase account for total of each department's purchases. Any discounts taken will be posted when the bill is paid. | Inventory Asset if using Transactional Posting or Cost of Goods if not | |
| Freight (if used) Either actual or estimated | Freight Expense | |
| Estimated freight (if used) | Default Location’s Estimated Freight Liability Acct | |
| Discount (first listed if > 1) | Total Disc to the Location’s A/P Disc Acct | Each department’s discount acct, its portion of total |
If using the Accrue Estimated Purchases option, a journal entry is created to reverse the accrued entry or the portion of the accrued entry if the entire Purchase Receipt isn’t imported into the Purchase Invoice.
| Vendor Journal Entry | Debits | Credits |
| Amount accrued at the Purchase Receipt for the product being invoiced | Estimated Payables account | |
| Amount accrued at the Purchase Receipt for the product being invoiced | Inventory account for the department |
If any accrual-type Add-On Charges were entered, each add-on charge creates a journal entry.
- Purchase Receipt – If used, the corresponding receipt is marked as Completed.
- Purchase Order – If used, the invoiced amount is incremented by the quantity entered at the Purchase Invoice. If filled, it is marked as such.
- Discount Posting – As the Purchase Invoice is saved, the discount posting appears to offset itself, debiting and crediting the same dollar figure. When the bill is paid, the actual discount taken is credited to the location’s A/P discount account leaving the net effect at the department discount accounts.
