Purchase Invoice Posting
Okay, now we just showed you how to record incoming payment of 1800. Okay, let’s go to the accounts payable module. We’re going to post the purchases of 4000 from vendor, V001. Let me show you. Here, purchases of 4000 from vendor, V001 should be the other way around, and the arrow should be pointing to the other way around. Let me just correct it first, because you’re buying from somebody, and this one’s supposed to be here. Okay. Now it looks good. See, the purchases, Sun Limited is buying goods worth 4000 from vendor, V001. Alright, and then, it returns 200 to vendor, V001.
Thank you for reading this post, don't forget to subscribe!
Okay. Let’s do it now. Let’s see now. We should change the amount to a smaller amount, say about 1000. Purchases for 1000. Otherwise, the end result of the profit and loss statement of Sun Limited will become losses because we have more purchase amount than sales, or maybe I make it 500 because we already have 1000 here. I am just trying to make sure we realize the profit end of the day. Okay, so purchases of 500.
Now, let’s do it now. We go here. Close everything. We’ll go step by step. Financial accounting, accounts payable, document entry invoice. Okay, I’m going to post the invoice. Let me select the vendor. Oh, this is company code, TES4. Let me just change the company code. It should be Sun, and, a, amount, 500.
I’m going to show you something. See this here? We don’t have a purchase account yet. We have a sales account, but we cannot post purchases to this account because only sales can be posted here. For purchases, we need to create an account. Okay, let’s do it now. Let me check the account group first.
Purchases account should have an interval of this 600,000 to this. Purchases are also known as cost of sales. You can also call it purchases, but nowadays, in the modern accounting world, people are calling it as cost of sales, especially in the US, so better stick to cost of sales then. This also means purchases.
Alright. Let me create my first account for cost of sales. FS00. Create. Choose cost of sales, COS. COS stands for Cost of Sales, so just an abbreviation. Laptop. I buy laptop from somebody and selling it to my customer, so field status group is Cost Accounts. You can put Cost Accounts.
Alright, done. So I can use this now. Copy, and come back to Invoice Entry Screen, so I post this here, 500. Let me simulate, enter valid date, yes, please enter valid date. Ok, let’s simulate.
Alright, I’m buying from vendor A, a laptop for 500, alright, let me post it. Posted, so let me check my financial statement.
You see this? Sales minus cost of sales, COS stands for cost of sales, I get 1300, which is my profit. Sounds good.
So now this line is capital and you have liabilities and all that. The total of this is 20,500 on the liability side. This plus this will equate this, which is on the asset side. Good, right?
Okay. Go back. Let me just see what the next topic is. We’ve done this. We’ve done this step. Next is we need to post another purchase of 1000 from vendor V002. Okay, let’s do it now. Post it again. The second vendor, F4, F2, how much is that? 1000. Post it. 1000.
Cost of sales is 1000. Post it. Let me check the financial account statement again. Oh, our profit has reduced. Our profit balances now.
Now, let me check the vendor balances now. Do you know how to check the vendor balances? You have to go here, display balances, this is the vendor.
First vendor of all items. This is the first laptop that we bought here, and this is the second laptop. Let me just check the other one, 1000, which is this.
Alright, now we have reversal wrongly posted purchase to vendor C002. We will see that in the next topic.
You may watch the full course on the following YouTube link
https://www.youtube.com/watch?v=QNgMJ53HVj4&list=PLN17Nn94liux88cwVwqbiRQQo1qK4sOdQ&index=18&pp=iAQB