Understanding Journal Entries for GST Goods Transactions

During the voucher match process, the system creates journal entries for the transactions and updates the Account Ledger table (F0911). The system debits the amounts associated with the journal entries in the intermediate accounts that you have set up in the GST Account Master Setup program (P75I805). During purchase order receipt, for landed costs lines with inventory items, the system credits the accounts for the AAI item 4385 (Cost/Expense Adjustments); for landed costs lines with non-inventory transactions, the system credits the accounts for the AAI item 4315 (Non-Inventory). The AAI accounts are used to maintain the GST balance in the intermediate GST accounts.

If the GST rule for the GST unit is set as nonrecoverable in the P75I805 program, the system updates the nonrecoverable accounts and does not affect the intermediate accounts.

For transactions where reverse charge is applicable, the system creates journal entries with the GST amounts that the purchaser must pay to the supplier. This is the amount that the system calculates using the provider's percentage set up in the GST Rules Setup program (P75I802).