Delivery From Receiving Inspection to Inventory
You can use the Receiving Transactions window to move material from receiving inspection to inventory. The system uses the quantity and the purchase order price of the delivered item to update the receiving inspection account and quantity. The system uses the average cost. The accounting entries are as follows:
The average cost is recalculated using the transaction value of the purchase order cost times the transaction quantity.
Material Overhead
If your item has material overhead(s), you earn material overhead on deliveries from receiving inspection. The accounting entries are as follows:
| Subinventory accounts
| XX
|
|
| Material Overhead Absorption account
|
| XX
|
Foreign Currencies
If the purchase order uses a foreign currency, the purchase order cost is converted to the functional currency before the accounting entries are generated. This converted value is used for receiving accounting purposes.
The average cost is recalculated using the transaction value of the purchase price converted to the inventory functional currency times the transaction quantity.
Expense Subinventories and Expense Inventory Items
With Oracle Purchasing and Inventory, there are two types of expense items. Purchasing has non-inventory purchases, such as office supplies or capital equipment. These items use an expense destination type for the purchase order's distribution information. You can inspect these purchasing items in receiving, but you cannot deliver these items into inventory.
However, expense inventory items can be stocked in a subinventory, but cannot be valued. Expense inventory items use an inventory destination type for the purchase order's distribution information. Expense inventory items can be delivered into both expense or asset subinventories.
When you receive to expense locations or receive expense inventory items the accounting entries are as follows:
| Subinventory Expense account @ PO cost
| XX
|
|
| Inventory A/P Accrual account @ PO cost
|
| XX
|
When you receive into an expense subinventory or receive an expense (non-asset) inventory item, the system debits the subinventory expense account instead of the valuation accounts.
See Also
Entering Receiving Transactions
Defining Sets of Books
Organization Parameters Window
