Perpetual Inventory
Overview
BOS Professional supports the Perpetual and Periodic Accounting model for Inventory.
- Inventory pricing must be carefully managed especially with perpetual accounting.
- If you make a mistake on a Purchase Order or on a Material Movement's transaction (for instance, you select an incorrect unit), the inventory price is immediately updated with an incorrect price. This incorrect price affects all the subsequent inventory transactions linked to the material.
How to Set Up the Perpetual Model
- The following Entry Types and Settings are required:
- The Accounting checkbox must be checked for the final status of each of the Entry Types.
- If an Inventory and Cost of Sales account is set on Materials, it overrides the accounts set up in the default Entry Types.
| Entry Type | VAT | Debit Account | Credit Account |
|---|---|---|---|
| Inventory Received (MMR) | No VAT | Inventory | Accrual / Suspense |
| Inventory Issued (MMI) | No VAT | Cost of Sale | Inventory |
| Inventory Returned (MMT) | No VAT | Inventory | Cost of Sale |
The debit side of the Accrual / Suspense account is as follows:
Fields Explained
| Field | Description |
|---|---|
| Entry Type | Supplier Invoice – Inventory items purchased |
| VAT | VAT applies if the supplier charges VAT |
| Debit Account | Accrual / Suspense |
| Credit Account | Supplier Account |