Subsequent Adjustment for Subcontracting

[former_member242554]

Hi,

when we do Subsequent adjustment for  Subcontracting in MIGO wherein Subcontractor use 1 more qty as comapre to mentioned in BOM.

then Accounting entry would be

Consumption A/c Dr - 1500/-

          Stock A/c Cr - 1500/-

pls explain me the same cost would not impact on the following entry:

Stock A/c Dr.

          Change in Stock.

Regards

Nitin

[mohsinabbasi007 · Accepted solution]

Dear NITIN,

Superb explaination in the said note share by Mr. Prasoon. Bottom line in note is

Example:

Initial Good Receipt Qty of Parent Material =10

Currently Stock Available Qty: 9

Value of Roh Material: 100

"In the above mentioned example, the previous goods receipt quantity is 10 PC. If the current stock quantity before subsequent adjustment was lower than goods receipt quantity for example 9 PC, then stock value will be posted proportionally by the goods receipt quantity i.e. : 9 PC * 100 EUR / 10 PC = 90 EUR."

Kind Regards

Mohsin Abbasi

[former_member242554 · Accepted solution]

Hi,

sorry i am not authorize to read prasoon note

My question is for Example:

Material A  which subcontractor return us maintained at MAP

we send the material B to subcontractor which is also maintained at MAP and price is Rs.50 each

To make one pieces of A subcontractor require a 10 pieces and and subcontracting charges is 30 Rs/pieces.

so at the time of GR accounting entry would be

Consumption A/c Dr.     500

          To Stock A/c Cr        500

External service A/c Dr.   30

           To GR/IR Clearing A/c 30

Stock A/c Dr. 530

         To Change in Stock   530

Now if vendor use 1 more qty of component then after posting subsequent adjustment, accounting entry would be, please be note that, no material is consumed meanwhile

Consumption A/c Dr.     50

          To Stock A/c Cr        50

My question is here in Balance Sheet your Stock account has been reduced but not increasing on other side due to absence of accounting entry

Stock A/c Dr. 50

         To Change in Stock   50

pls guide

[Prasoon]

Hi,

   Refer the KBA: 1702604 - Valuation of subsequent adjustment which explains the system logic.

Regards,

AKPT

[mohsinabbasi007]

Dear NITIN,

One more thing when ever subsequent adjustment is taken place it always trigger two movement type i.e. 121 & 543/544

I hope you will clear after watching the screen shot.

Kindly see the screen shot of actual subsequent entries in this regard.

Kind Regards

Mohsin Abbasi

[mohsinabbasi007]

Dear NITIN,

It's normal process when you talk about Subcontracting. Please go the link which is mentioned below and read the answer of Syed Hussain in this regard in that link.

http://scn.sap.com/thread/1344704

As far as your question regarding same cost is concerned, yes consumption is charged with moving average price of the material at that time, pass entry as accordingly.

Best Regards

Mohsin Abbasi