This article is Step 4 of Understanding Accounting Integration - Control Accounts > A/P Inventory Accrual


To see all the steps of Understanding Accounting Integration, please review - Understanding Accounting Integration



Step 4 - Control Accounts - A/P Inventory Accrual 




A/P Inventory Accrual is short for Accounts Payable Inventory Accrual and the account type should be typically set up as a Current Liability and usually maintains a credit balance

 
It just allows Blackpurl to receive inventory into stock by a Vendor Receiving (VR) without having a corresponding invoice from the vendor (VI)


When a VR is finalised, the accounting transaction is a journal entry:


Debit - Inventory G/L

Credit - A/P Inventory Accrual 


See example below of what the journal would look like in your accounting package:



Once the dealership processes the relevant Vendor Invoice (VI) then the transaction would look similar to this:

Debit - A/P Inventory Accrual 

Credit - Accounts Payable under the relevant Vendor name



The end result should have the A/P Inventory Accrual clearing out:


 

 

The balance of the Dealership's A/P Inventory Accrual General Ledger should be only those Blackpurl VR that have not yet had a VI finalised together with any Vendor Returns that have not finalised

You can run a report in your Blackpurl to find these VRs - Reporting - Active Receivings and a list of Vendor Returns - How to Create a Vendor Return for Parts and How to Report on Vendor Returns


Accounting entries to this A/P Inventory General Ledger account should never be made directly from the accounting application as its balance should always match with Blackpurl Receivings which have not been reconciled with a vendor invoice and unfinalised Vendor Returns