This article is Step 4M of Understanding Accounting Integration - Control Accounts > Consignment Clearing
To see all the steps of Understanding Accounting Integration, please review - Overview - Understanding Accounting Integration
Step 4M - Control Accounts - Consignment Clearing
- This General Ledger account is used as a Clearing Account for Consignment Unit transactions and the account type is generally set up as a liability account
- Consignment Units are Customer Owned Units held by the Dealership on consignment until sold
The link to this article will explain how you indicate that a Customer Owned Unit is on consignment - Consignment Units
- As the Dealership is not actually purchasing the Customer Owned Unit, these units will never show up in the Dealership's Inventory General Ledger so we need a way of clearing these transactions through your accounting package once the unit is sold and we use this Consignment Clearing General Ledger account to do that
- Once the Consignment Unit is added to a Customer Order > Unit Deal and the Unit Deal is finalized is when this Consignment Clearing General Ledger will be used
When the Consignment Unit is sold, there will be a journal entry to the Consignment Clearing General Ledger
It will for the funds due to the original owner / Seller of the Customer Owned Unit / Consignment Unit as the Dealership has sold the unit on their behalf
An example of the journal entry where the funds await payment to the original owner / Seller of the Consignment Unit with the offset to the relevant COGS General Ledger to complete the sales entry:
This is the Adjustment Note that Blackpurl integrates to your accounting package for you to pay the original owner / Seller for the Consignment Unit which is processed as a refund:
The following will show you the balanced entries to the Consignment Clearing General Ledger account
- This Consignment Clearing General Ledger should be a true clearing account.
Restrictions
Accounting entries to this General Ledger account should never be manually posted in the accounting application as it should be for Blackpurl transactions only
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