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Former Member
Nov 13, 2012 at 03:04 AM

why no reversal of WIP

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hi,

say to produce output of quantity 5 and finished goods price at $10.

1 25 Oct, goods issued to production order.

2 31 Oct, GR quantity of 2.

3 Oct Month end routine to calculate WIP and during settlement,

dr wip of 30 and
cr revenue 30

4 Nov month end, GR quantity of 1. so there is still of WIP of quantity 2 (2x$10 = $20)

I was told, during nov month end, system will NOT reverse quantity 3 (3x$10=$30) for point 3. meaning system will continue to book new wip of quantity 2. meaning in the system, the total wip is becoming

dr wip 50 (30 Oct month settlement + 20 nov month settlement)

cr change in wip 50

May i know why there is no reversal of below in nov month settlement before book wip of 20 (2x$10=$20)?

dr change in wip 30

cr wip 30

thanks