| Sales and Distribution Accounting
Entries
INVOICE GENERATION
Invoices will be generated at the Smelters and
stock points. The accounting entries for the sale of goods despatched will
flow from the Sales invoice generated in SAP Sales and Distribution module.
The following entries shall be passed
Customer Account
Dr
Revenue
Cr
Excise Duty Payable
Cr
Sales Tax Payable (local or central)
Cr
Note: As mentioned above in the FI document, which is
created in the background, the SD invoice number shall be captured. However
as per the current accounting procedure the accounting entry passed is
as follows :-
Customer Account
Dr
Revenue
Cr
Excise Duty Billed
Cr
Sales Tax Payable (local or
central) Cr
Excise duty paid a/c
Dr
Excise duty payable a/c
Cr
EXPORT SALES
There have been very few export transactions in the past.
SAP system will be designed to handle export business. Exports are mainly
from the mines and will be handled at the mines, however the documentation
part will be taken care at the Head Office. The accounting entry is:
Customer Account
Dr
Revenue (Exports)
Cr
The realisation of export sales will be directly credited
to the bank. The accounting entries will be as follow:
Bank
Dr
Customer
Cr
Exchange Fluctuation
Dr/ Cr
The accounting entries will be:
Rebates/Discounts
Dr
Customer
Cr
DEBIT MEMOS
Debit Memos shall be issued in case of price difference,
sale tax difference and interest on usance period and overdue payments.
The accounting entries for two possible scenarios are
as follows:
Price Undercharged:
Customer Account
Dr.
Revenue
Cr.
Sales tax payable
Cr.
Sales tax undercharged
Customer Account
Dr.
Sales tax adjustment
Cr.
Interest on delayed payments/usance period and other charges
Customer Account
Dr.
Interest Others
Cr.
In case of HZL a complete retirement or a partial
retirement of asset is done. The system uses the asset retirement date
to determine the amount to be charged off for each depreciation area. The
existing accounting policy is to provide depreciation for the full quarter
in which the asset is sold/discarded, recommended that the depreciation
be provided from the date of acquisition on prorata basis .
Accounting entry for sale of Asset to customers:
Customer Account
Dr
Asset Sale
Cr
Accumulated
Depreciation Dr
Loss on Sale
(if applicable) Dr
Asset Sale
account
Dr
Asset account
Cr
Profit
on sale (if applicable)
Cr
Note: In case of any Sales Tax /Excise duty applicable
for this transaction, SAP will calculate the Sales Tax/Excise Duty based
on the Tax Code selected the entry is posted to the GL Account (Sales
Tax Payable)
Accounting entry for sale without a customer:
Accumulated Depreciation Dr
Loss on Sale (if applicable) Dr
Asset Sale account
Dr
Asset account
Cr
Profit on sale (if applicable)
Cr
Accounting entry for scrap
Accumulated Depreciation Dr
Loss on Sale of Assets
Dr
Asset account
Cr
SALE OF SCRAP
The sale of scrap (non-stock) shall be mapped as a direct
manual FI entry. The customer will be created as a FI customer. No Logistics
module will be involved in the process.
A FI Invoice will be prepared for the sale of scrap with
the following entries:
Customer
Dr
Sale of Scrap
Cr
Excise Duty Payable
Cr
ADVANCES FROM CUSTOMERS
Advances are received from the customers against delivery.
These advances will be recorded in a special general ledger account. The
accounting entry for the same will be:
Bank Account
Dr
Advance Customer Payments
Cr
These advances will be later on adjusted against the invoices
raised on the customers. Advances can be adjusted against more than one
invoice at the time of clearing of the invoices against advances.
Adjustment of Advances
Customer Account
Cr
Advance Customer Payments Dr
A financial document would be created for each Bank Guarantee
received and this document number will be referred to in the Sales Order
which would then monitor the value and the validity of the of the Bank
Guarantee instrument wise while doing the billing.The letter of credit
/Bank guarantee given will be recorded as a noted item.
Accounting Entry for Goods receipt
Stock/Inventory account
Dr
GR/IR account
Cr
Freight clearing account
Cr
Accounting Entry on invoice verification of supplier
GR/IR
Dr
Vendor account
Cr
Accounting Entry on invoice verification of freight vendor
Freight clearing account
Dr
Freight Vendor account
Cr
GOODS RECEIPT
Based on the Purchase order and the Quantity actually
received Goods Receipts (GR) will be done. Based on the GR done the following
accounting entry will be passed in the Financial Accounts
RM/PM Stock Account Dr
GR/IR Account
Cr
Freight Clearing Account
Cr
EXCISE INVOICE VERIFICATION
On receipt of the excise invoice cum gate pass the following
entry will be passed
RG 23 A / RG 23 C Part 2 Account Dr
Cenvat Clearing Account
Cr
*-- Shashikanth Teegala - skteegala@yahoo.co.in
Financial Posting
Inventory
Accounting Entries
Get help for your SAP FI/CO problems
Do you have a
SAP FI/CO Question?
SAP Books
SAP Certification,
Functional, Basis Administration and ABAP Programming Reference Books
SAP FICO Tips
SAP FI/CO Tips
and Financial Accounting/Controlling Discussion Forum
Best regards,
SAP Basis, ABAP Programming and Other IMG Stuff
http://www.erpgreat.com
All the site contents are Copyright © www.erpgreat.com
and the content authors. All rights reserved.
All product names are trademarks of their respective
companies. The site www.erpgreat.com is in no way affiliated with
SAP AG.
Every effort is made to ensure the content integrity.
Information used on this site is at your own risk.
The content on this site may not be reproduced
or redistributed without the express written permission of
www.erpgreat.com or the content authors.
|