Freight Charges in AP Invoice

[Former Member]

Hi All,

I am created one GRPO for raw material includes freight charges as Rs.200 which is inventories & system passed the respective entry to stock account including freight charges. The problem is when I create the AP invoice for the same GRPO, system pass the JE which debits the Inward transportation a/c by Rs.200 & credit the Sundries Rounding off A/c by Rs.200 along with other normal debit & credit.

I am not able to understand this behavior as system has already inventories the freight charges but its again hitting the expense account of freight charges.

Please reply as soon as possible.

Regards,

Abhishek

[Former Member · Accepted solution]

Hi Abhishek

Your account determination is incorrectly set up. The Goods Receipt PO must post to an interim expense account for Freight charges and reallocate this when the invoice is posted to the actual expense account. Bear in mind that a Goods Receipt PO is not a payable document, but the Invoice is. Therefore the expenses on GRPO is an indication but only final when the supplier provides the invoice. At this point SAP takes the Freight Charges as final and will post to the expense account for the freight charge.

Kind regards

Peter Juby

[Former Member · Accepted solution]

Hi Peter,

Can you explain the accounting entries incase if I want to inventories the freight charges? It will be great help if you able to provide the actual accounting entries.

Thanks & Regards,

Abhishek

Edited by: Abhishek A on Apr 25, 2009 12:21 PM

[Former Member · Accepted solution]

Hi ! Abhishek

Make ths setup in Test System and Try it.

1. Create a new Frieght Master.

2. Select Distribution Method as "Quantity"

3. Check the "STOCK" check box.

4. If, GL setup by Warehouse then, go to approp warehouse and set

Expenses Clearing Account - "clearing acc"( this account will be zero after invoice posted. same like

Allocation acc)

5. Book a GRPO with frieght.-see Audit report to confirm Frieght amount added with itemcost.

6. Book A/P invoice.

Acc posting.

GRPO:

Inv acc Debit

Allocation Acc Credit

Expenses Clearing Account Credit

AP Invoice:

Vendor Credit

Allocation Acc Debit (net 0)

Expenses Clearing Account Debit (net 0)

Hope this will help.

Regards,

Thanga Raj.K

09710445987

[Former Member · Accepted solution]

Hi,

Thanks for the prompt reply.

I am following the same method for accounting of freight on stock but getting the above mentioned problem. Please reply on this.

Just tell me one more thing that If I give the distribution method other than quantity, will there be any diffefference in the system behaviour (in terms of accounting)?

Regards,

Abhishek

[Former Member · Accepted solution]

Distribution method behaves like this.

1. Quantity:If, u have 2 different item of each 2 quantity in line means, freight amount will be divided by 4.

and itemcost will be increased.

2. Volume or weight: your freight amount divided based on that.

3. Row Total : Your freight amount divided by Rowtotal.

Account Posting will be same as said before, if u have same inventory account,allocation acc and expense clearing acc for all items. The Diff will be in ItemCost. ItemCost will be affected based on Dist.Method. Check in Audit Report.

Regards,

Thanga Raj.K

09710445987

[Former Member · Accepted solution]

Hi,

The above discussed process is fine but my problem is that system is hitting an extra accounting after loading the freight on stock while passing AP Invoice. So, I am able to understand the reason for the same.

Any Inputs ...???

Regards,

Abhishek

Edited by: Abhishek A on Apr 28, 2009 12:18 PM

[Former Member · Accepted solution]

Hi Abi.

can u tell me,

1. what is the inventory acc?

2. what is the allocation acc?

3. what is the expense clearing acc?

4. what is the Expense acc in freight master?

Also, tell me the flow on transaction and transcation postings...

ie, r u adding GRPO and A/P invoice or direct A/P invoice?

Regards,

Thanga Raj.K

09710445987

[Former Member · Accepted solution]

Hi Thanga Raj K,

1. what is the inventory acc? --> Stores & Spares (Stock Account - 231010)

2. what is the allocation acc?--> GR/IR Clearing A/c (130100)

3. what is the expense clearing acc?--> GR/IR Clearing A/c (130100)

4. what is the Expense acc in freight master? --> Inward Transportation A/c (411121)

When I book GRPO for one inventory item XYZ for Rs.100 & Rs.10 for freight, its following accounts -

231010 - Stores & Spares A/c Debit Rs.110

130100 - GR/IR Clearing Account Credit Rs. 110

During AP Invoice -

130100 - GR/IR Clearing Account Debit Rs. 110

V00001 - Vendor Account Credit Rs. 110

411121 - Inward Transportation A/c Debit Rs. 10

416460 - Sundries Rounding Off A/c Credit Rs. 10.

I want to the reason for the entries to last to accounts (In bold,which are unnecessary)?

Regards,

Abhishek

[Former Member · Accepted solution]

hI!

Don't map any acc in freight master and Exp offset acc. And try to add A/P invoice.

Regards,

Thanga Raj.K

09710445987

[Former Member]

Hi

If your client need optuion to pay frieght charges to vendor then only the distribution method should be equall or quantity.

If he does not want to pay frieght to vendor then set distribution method as none.

Suppose if ur maintaing different types of freight so u cannot assign expense clearing account in warehouse accounting tab.

If distribution method is none u need to manully update the item cost by using landed cost menu.

Regards

M Auditya