There are two options in the Inventory Setup window that need to be considered when defining the various posting accounts in Microsoft Dynamics 365 Business Central.
We will go through how these options create different GL entries during the purchase order process so you can make the selection that is best for your procedures. The review will take you where the default account numbers are pulled from during the various purchase order processing transactions.
Automatic Cost Posting
The first consideration is whether automatic cost posting is enabled or not. This option is located in the Inventory Setup window.
If automatic cost posting is NOT enabled, there will be one entry made during PO invoice posting.
- The Dr Account defined in Purch Account field from General product posting group
- The Cr Account defined in Payables Account field from Vendor posting group
If automatic cost posting is enabled, an additional entry will be posted.
- The Dr Account defined in Inventory Account field from Inventory posting group
- The Cr Account defined in Direct Cost Applied account field from General product posting group
Note: with the selections above, if a PO receipt/shipment is posted without the invoice there will be no GL entry made. It will only post an entry when the invoice is posted.
Expected Cost Posting
If expected cost posting is enabled (also in the Inventory Setup window), a GL entry will be made at the time of the receipt/shipment, regardless of whether it was invoiced.
Entry made during PO receipt/shipment:
- Dr Account defined in Inventory Account (Interim) field from Inventory posting group
- Cr Account defined in Invt Accrual Acc. (Interim) field from General product posting group
- Note: this is often an accrued purchases account
Entries made during PO invoice:
- Dr Account defined in Purch Account field from General product posting group
- Cr Account defined in Payables Account field from Vendor posting group
- Dr Account defined in Invt Accrual Acc. (Interim) field from General product posting group
- Cr Account defined in Inventory Account (Interim) field from Inventory posting group
- This reverses out the accrual posted during the receipt/shipment
- Dr Account defined in Inventory Account field from Inventory posting group
- Cr Account defined in Direct cost applied account field from General product posting group
If the PO receipt/shipment and invoice are posted at the same time:
- Dr Account defined in Purch Account field from General product posting group
- Cr Account defined in Payables Account field from Vendor posting group
- Dr Account defined in Inventory Account field from Inventory posting group
- Cr Account defined in Direct cost applied account field from General product posting group
Hopefully this helps you cut through the different General Ledger posting options. For questions or additional help, visit our Support website.
