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New stock entry difference account


#1
Hi,

Checked documentation but cannot find definition/function of the difference account while doing a stock entry.
I want to recorded existing stock in an organisation: It the value of all entries accrued in an account head. Default says "Cost of Goods Sold " but that is not applicable here.
Also in https://frappe.io/apps/erpnext/user-guide/stock-inventory/stock-entry  the screenshot is unreadable even if enlarged (resolution) and the manual should give details on how to enter an item, like the effect of the price and account heads that can be entered.
rgds robert



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How to use Difference Account in Stock Entry?
Stock entry difference account. Which to choose?
#2
To update opening stock for non-serialized item, you should make Stock Reconciliation. And for serialised item, you can make Stock Entry of type Material Receipt. 

In both cases, you should enter "Difference/Expense Account" as "Temporary Liability" account. On submission of the document, system will debit warehouse account which is an asset account and credit difference/expense account. Before making those entry, make sure you have enabled "Perpetual Inventory" by checking Stock Settings page.

If you are not making opening stock entry, you can select "Stock Adjustment" account in Difference/Expense Account field which is an expense account.

To learn more about perpetual inventory, please check following pages:
https://frappe.io/apps/erpnext/user-guide/stock/accounting-of-inventory-stock
https://frappe.io/apps/erpnext/user-guide/stock/perpetual-inventory


On 04-May-2014, at 9:59 pm, robert <be...@gmail.com> wrote:

Hi,

Checked documentation but cannot find definition/function of the difference account while doing a stock entry.
I want to recorded existing stock in an organisation: It the value of all entries accrued in an account head. Default says "Cost of Goods Sold " but that is not applicable here.
Also in https://frappe.io/apps/erpnext/user-guide/stock-inventory/stock-entry  the screenshot is unreadable even if enlarged (resolution) and the manual should give details on how to enter an item, like the effect of the price and account heads that can be entered.
rgds robert



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#3

i tried using the temporary liability error shows up

Expense / Difference account (Temporary Liabilities - WEB) must be a ‘Profit or Loss’ account


#4

Hi, of all the posts referring to “Difference account” in a stock entry is the only one that I was able to extract some relevant information.

Likewise, I still do not understand the objective of “Difference account” if it is a Liabilities or Expenses account, and if the objective is that it be temporary, when this account is updated again.

There is also no place to set up a default account, either in company or stock settings, etc.

Thanks.


#5

I need help with the difference account.
I need upload opening stock for raw material, then I set the difference account as 107.001 the raw material account.
I got an error.
Why I can’t create the stock recon?
Do I have to create another coa and set it as temporary account?
What is the function of the account anyway?
Please I need some help, totally confused about the process.


#6

You can refer to your accounting team about this question and they will help you since it is a pure accounting concept.
If you don’t have accounting team, any stock transaction need two accounts, in your case material account will be debited and temporary or clearing account to be credited,
In normal case you will receive a PO and from settings all accounts are derived.


#7

I see, so the difference account should be the credit account right?
and it can be the temporary account or clearing account. I get it.
Thank you so much Mr.
This is the best explanation for me