What is Purchase Accounting?
The Accounting menu has a Purchases sub-menu to view and manage activities related to purchasing goods. So the activities of purchasing goods to suppliers, starting from pre-orders, receipts, and settlements to the return process, can be done from here.
In this menu, you will find five sub-menus, namely:
- Purchase order
You can order goods from suppliers or pre-order through this menu. In addition, the Purchase Order menu also displays details of pre-orders that have been made previously. - Goods receipt
You must accept the goods through the Goods Receipt menu when the ordered goods have arrived. This menu also displays details of receipt of pre-existing goods. The number of goods received can be as ordered or different between less or more than the order. - Bill
A bill will be issued according to the number of items received. The bill may change from the initial order amount, for example, 90 pcs of goods received from a total order of 100 pcs. - Payment
On the Payments menu, you can pay off bills that have come out in this menu. You can choose the payment method based on two things: invoice or Advance. - Return Process
Like buyers in general, you can also apply for goods returns to suppliers. To make a return, you can go through this menu Return Process. There are two ways to choose from: withholding invoice or Refunding Money.
Case study:
When making a purchase to a supplier, you will issue a coded order number (PO) seen in the Purchase Order menu. The next process is to receive the purchased goods, in the Goods Receipt menu.
The number of goods received must be recalculated and recorded according to their condition. If the goods received exceed the quantity ordered or vice versa, it will affect the invoice value of the goods. And the price you have to pay.
When the goods have been received at Jubelio, you will receive an invoice for the purchase. The amount depends on the total goods received. You can do it in the Payment menu to pay off your bill.
If the goods arrive partially, you have to pay in advance according to the number of goods received. The rest will be paid off when you receive the rest. The purchase order will not be completed until all items are received.
Returns:
Exchange Products Returns are replacements not in the form of money but with other products. The monetary value of the returned product will be transferred to another product. Suppose there is a price difference between the returned product and its replacement. In that case, it will be resolved by making another invoice.
Money Returns means replacing the goods that are requested for a return with the same amount of money as the goods.
For example, you procure stock by ordering 100 t-shirts from suppliers worth 10 million rupiah. Then, you want to return 10 shirts because there is damage.
After submitting a real return, you must record it at Jubelio to adjust the financial balance. In addition, the purchase return process is also divided into two, namely by cutting invoices or getting money back.
These two return options will affect the flow of stock and cash recording of your business. Withholding invoices (replace goods) will usually involve the stock and its COGS. Meanwhile, the return of money, if it is not recorded will affect the cash and bank financial records.