The following GL Entry is created when a Shipment Receipt is Posted:
CR - Liability Account: Pending Liability
Inventory
Each product has an Inventory GL Account associated with it. This is set up with the product.
Accounts Payable
Pending Liability is used to hold the liabliity that is to be posted as bills. It is to record the fact that you have a pending liability for the inventory that is received. This account can be specified in Setup, Entity Setting, Shipment Receipts, Credited Account for New Shipment Receipts. If not set, the parent GL account Accounts Payable is used.
When a bill is created and linked to the shipment receipt which is how bill for received inventory should be created, the system would reverse the entry made at time Shipment Receipt is posted and then post a new entry using the amount that is on the bill that looks like this. It is possible the bill amount is smaller or bigger than the original amount posted at time of receipts. The initial value posted as shipment receipt is determine using the price on the Purchase Order.
Reversing Entry
DB - Liability Account: Pending Liability
New Entry
CR - Liability Account: Accounts Payable for Selected Supplier
If the received value upon shipment receipt posting is different from the amount posted with the bill, your inventory value will be updated via these 2 entries. This can happen if the bill amount is different from the PO amount. For example, your supplier gave you a unexpected discount off the original PO value.
Below only applies If you are using FIFO costing method for inventory costing.
If you have already sold some of these inventory, the COGS posted for these sold inventory would be based on the original value and not the new value. Versa can go back and update these COGS posting if you activate this setting Setup, Feature Settings, Bills, 'Auto Adjust COGS amount posted if bill line unit price is different from the PO line unit price when linking a bill item to a shipment receipt.'. If this setting is not turned on, you would manually post to the COGS account to reflect the new costs.
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