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Aug 24, 2023 at 08:18 AM

Price Difference

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Hi gurus,

based on the below text for SAP Business One, i have a question:

In a perpetual inventory system, you post an independent A/P credit memo or A/P goods return:

  1. Add a goods receipt PO for an item with a quantity of 10 and unit price of 5.00.

    The Inventory Audit Report shows a Cumulative Quantity of 10 and a Cumulative Value of 50.00

  2. Add an A/P credit memo or A/P goods return with a quantity of 10 and unit price of 4.50.

The Price Difference Account is used when the In Stock quantity of an item is reduced to zero.

This account holds the difference between the transaction amount (in the A/P credit memo or A/P goods return) and the item's current cumulative value.

Therefore, the Price Difference Account is debited by 5.00 (the price difference of 0.50 by the quantity of 10) in order to zero the inventory cumulative value.

So, if i had a GRPO 10 Qty x $ 5 unit price, then use Goods Return, the same PO will reverse i.e. -10 Qty x $ 5, if my stock have 10 Qty of total value $ 80, after posting the Goods Return, my stock value will be $ 30, will Price Difference get affected in this return?

Thanks.