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Jiwa Sales Orders - Journals Created By The Sales Order Process

In this article we will look at the journal entries that are created during the sales cycle in Jiwa.

The entries that are created in the General Ledger are dependant on how your Jiwa database has been set-up and the billing type used.  In this article we will look at all billing types based on the following system settings;

  • Use Inventory Sales Ledger Invoicing setting is set to Yes which means that the sales account applied to the invoice lines is taken from the Sales control account in Inventory Maintenance | Other | Ledgers
  • Post Non Physical To COGS Invoicing setting is set to No which means cost of sales are not posted for non physical items.  Sales reports include this cost in COGS(2)
  • Branch Invoicing Invoice setting is set to No which means that the sales division field is hidden on the Sales Order Entry form
  • Branch SegNo Ledger setting is only applicable if Branch Invoicing is enabled

 

 

Physical Items

 

Ship & Bill Sales Orders

Ship and Bill sales orders are orders where the sale and cost of sale are posted to the General Ledger with each delivery of the sales order.

 

 

 

To demonstrate this the following sales order will be processed

 

With each snapshot the following journal entry is created taking up the sale and cost of sale.

 

Income and cost of sales appears on the Profit & Loss report.

 

 

Bill Complete Sales Orders

Bill Complete sales orders are orders where part deliveries are made however the sale and cost of sale are not posted to the General Ledger until the order has been delivered in full.

 

 

In this example we have an order that can only be part delivered on the first snapshot.

 

The following journal entry is created on the first delivery.

The value of stock delivered is transferred from the Inventory Control account to the Stock Assigned Value account, indicating that stock has been supplied but has yet to be invoiced.

 

On the last delivery (snapshot) the following journal entry is created.  Because this is the final delivery on this order and the order is now closed the sale and cost of sale is taken up in the General Ledger.

 

 

Ship Complete Sales Orders

Ship Complete sales orders are orders where stock is not delivered to the customer until the order can be delivered in full.  Only when the full order is delivered is the sale and cost of sale taken up in the General Ledger.

 

 

In this example we have an order that can only be part delivered on the first snapshot.

 

When the snapshot is processed the following journal is created.

The value of stock allocated to the order is transferred from the Inventory Control account to the Ship on Completion account, indicating that stock has been allocated to a Ship Complete order that cannot be delivered.

This journal entry is reversed with each processed snapshot.

 

When the order can be delivered in full on the last processed snapshot the following journal entry is created.  Because the order can be delivered in full the sale and cost of sale is taken up in the General Ledger.

 

 

Non Physical Items

The posting of sales to the General Ledger for non physical items is the same as that of physical items detailed above however the posting of cost of sales is dependant upon the set-up of your Jiwa database.

Non Physical items generally do not post cost of sales unless the Post Non Physical To COGS Invoicing system setting is enabled.  When this setting is enabled costs are posted to the General Ledger as per the postings for physical items detailed above.

The Post Non Physical to COGS setting is typically only enabled when cost recoveries need to be posted to the General Ledger such as Labour costs.  An estimated cost of the item is posted to the General Ledger using the last cost from the inventory maintenance form.  The cost of sales account on these items is typically set to a cost recovery account.

For further details on non physical items and cost recovery please contact your Jiwa Consultant.

 

 

Non Inventory Items

Non inventory items do not have an inventory maintenance record and are typically used for one off items or special purchase items that you want to sell but not create an inventory record for.

The posting of sales to the General Ledger for these items is the same as that of physical items detailed however non inventory items do not post any cost of sales. 

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