Example of Procurement Flow using Dual Units of Measure with Partial Receipt and no Invoice

This example illustrates the accounting entries for a procurement flow with partial receipts and no invoice when using dual units of measure.

Scenario

Let's consider a purchase order for an item A005. The details for the purchase order PO1 are listed in this table.

Quantity	UOM	Secondary Quantity	Secondary UOM	Unit Price	Pricing UOM	Amount	Invoice Match Option
100	Ea	200	Lbs	$1.000	Lbs	$200.000	Order

You should note that the purchase order is priced by the secondary UOM and, therefore, the amount is calculated by using the secondary quantity. Also, the invoice match option is set to order.

For this PO, you have these receiving transactions.

Transaction	Transaction Quantity	Transaction UOM	Secondary Quantity	Secondary UOM
R1	4	Ea	9	Lbs
R2	2	Ea	4.5	Lbs

You also have an inventory put away transaction as listed in this table.

Transaction	Transaction Quantity	Transaction UOM	Costing Quantity	Costing UOM
D1	2	Ea	4.5	Lbs

Also, no invoice has been raised.

Analysis

We know the primary UOM is Each and the secondary UOM is Lbs.

For the purchase order PO1 we have this information:

Uninvoiced PO Quantity: 100 Ea

Uninvoiced PO Amount: $100.000

And for the put away transaction D1 we have this information:

Uninvoiced Delivered Quantity: 2 Ea

Uninvoiced Delivered Amount: $2.000

Therefore, the acquisition amount is $2.00. We arrive at this value by using this equation:

Acquisition Amount = Total Uninvoiced Delivered Quantity * Latest PO Price + Total Invoice Amount

In this case, we have no invoice.

The total delivered quantity in the costing UOM is 4.5 Lbs. Therefore, the unit cost in the costing UOM is $0.444.

$2.000/4.5 = $0.444

The corresponding entries created in Oracle Receipt Accounting are here.

Accounting Line Type	Source Document Number	Quantity	UOM	Unit Cost	Amount
Receiving Inspection	PO1	4	Ea	$1.000	$4.000
Receiving Inspection	PO1	2	Ea	$1.000	$2.000

The corresponding entries created in Oracle Cost Accounting are here:

Accounting Line Type	Reference Number	Costing Quantity	Costing UOM	Unit Cost	Amount	Document Number
Purchase Order Receipt	PO1	4.5	Lbs	$0.444	$2.000	D1