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Re: Cost of goods sold account

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Hi Pooja..

 

cost of goods sold account is involved delivery transaction.

 

cogs gets debited in journal entry of delivery.

 

allocation account/Goods received not invoiced account

 

is involved in goods receipt purchase order transaction.

 

allocation account is offset account,once

 

ap invoice is created the amount will shown as

 

outstanding for the vendor.

 

allocation account gets credited in journal entry of grpo.

 

Cost of the inventory sold will be deducted from the inventory account and get transferred to COGS account.since the sale results in decrease in stock the inventory account is credited

 

Purchase results in increase in inventory and hence inventory account is debited.GRIR is a temporary account which is reversed when you post AP invoice

 

Hope above answer will solve your query.

 

Regards

Kennedy


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