mm process entries

8/2/2019 Mm Process Entries

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What should be my accounting entry in procurement?

For Domestic Procurement of Raw Material

During GR

Material Stock Dr.

GR/IR clearing Cr.

During Excise Invoice Credit

Cenvat Account Dr.

Cenvat Clearing Cr.

During Invoice Verification

Cenvat Clearing Dr.

GR/IR Clearing Dr.

Vendor Payable Cr.

For Domestic procurement of Capital Goods

During GR

Material Stock Dr.

GR/IR clearing Cr.


Cenvat Account Dr. (50%)

Cenvat On-hold Dr. (50%)

Cenvat Clearing Cr.


Cenvat Clearing Dr.

GR/IR Clearing Dr.Vendor Payable Cr

Subsequent of Capital Goods

Cenvat Account Dr. (50%)

Cenvat On-hold Cr. (50%)

For Import Procurement of Raw Material

During Customs Duty Clearing invoice

Custom Clearing Dr.

Custom Payable Cr.

During GR

Material Stock Dr.

GR/IR clearing Cr.


Cenvat Account Dr.

Custom Clearing Cr.


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GR/IR Clearing Dr.

Vendor Payable Cr.

For Excise Duty Credit of Raw Material without PO

Cenvat Account Dr.

Cenvat Clearing Cr.

For Excise Duty Reversal through Excise JV

Cenvat Clearing Dr.Cenvat Account Cr.

What should be my accounting entry when the goods are issued through MM and excise invoiceis created (J1IS & J1IV)?

During Excise Invoice Creation

Cenvat Suspense Account Dr.

Cenvat payable Cr.

For TR6C Challan

PLA Account Dr.

PLA on hold Account Cr.

During Fortnightly Utilization

Cenvat payable Dr.

Cenvat Account Cr.

PLA Account Cr.

Note: Cenvat Suspense Account should be cleared appropriately using FI JV's.

What should be my accounting entry in subcontracting reversal / Recredit?

For Subcontracting Challan Reversal

Cenvat Reversal Dr.

Cenvat Account Cr.

For Subcontracting Challan Recredit

Cenvat Account Dr.


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Cenvat Reversal Cr.

What should be my accounting entry in SD ?

For Factory Sale

During Billing Document

Customer Account Dr.

Sales Account Cr.

Cenvat Suspense Account Cr.



Cenvat payable Cr.

For TR6C Challan

PLA Account Dr.



Cenvat payable Dr.

Cenvat Account Cr.

PLA Account Cr.

For Stock Transfer through SD

No Accounting entries for Performa Billing Document



Cenvat payable Cr.

For TR6C Challan

PLA Account Dr.



Cenvat payable Dr.

Cenvat Account Cr.

PLA Account Cr.

Note: Cenvat Suspense Account should be cleared appropriately using FI JV's.


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Initial stock entry:Movement type - 561(Receipt per initial entry of stock balances into unrestricted-use)TCODE - MB1CFI Document Type - WA

89 Raw material BSX S91 Initial Stock entry GBB BSA H

Physical inventory differences:Movement type 702 (Goods Issue Physical Inventory difference) this is triggered because of themovement type 102, which is given while calculating the difference INV: for expenditure/income frominventory differencesTCODE - MI07 (MI01 & MI04)FI Document Type - WI

81 Inventory differences G/L GBB INV S

99 Raw material BSX H

Goods Issue to Production Order:Movement type - 261 (Consumption for order from warehouse) VBR: for internal goods issues (forexample, for cost center)

TCODE - MB1AFI Document Type - WA: Goods Issue

81 Raw material Consumption GBB VBR S

99 Raw material BSX H

In case Movement type given is 201(Consumption for cost center from warehouse), at the time of MB1Asystem asks for the COST CENTER & GENERAL LEDGER. Here, the account determination happensdirectly from MB1A and not from the OBYC. Accounting entry will be same as above except the 'Rawmaterial Consumption'; it triggers whatever the GL given.Goods Issue / Delivery: SDMovement type - 601 (Customer delivery) VAX: for goods issues for sales orders without accountassignment object (the account is not a cost element)TCODE - VL02FI Document Type - WL: Goods Issue/Delivery

81 Mater. consumed/tradinggoods without costelementCOGS

GBB VAX S

99 Finished Goods BSX H

Goods Receipt: FG PPMovement type - 101 (Goods Receipt) GBB-AUF: for goods receipts for orders (without accountassignment) and for order settlement if AUA is not maintainedTCODE - MB31 Goods Receipt for Production OrderFI Document Type - WE: Goods Receipt

89 Finished Goods BSX S

91 Inventory change factoryoutput COGP

GBB AUF H

Goods Receipt: RM MM

Movement type - 101 (Goods Receipt)TCODE - MIGO Goods Receipt for Purchase OrderFI Document Type - WE: Goods Receipt

89 Raw Material BSX S

96 GR / IR Clearing account WRX H

Invoice Receipt: RM MMMovement type - 101 (Goods Receipt)TCODE - MIGO Goods Receipt for Purchase OrderFI Document Type - WE: Goods Receipt


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86 GR / IR Clearing account WRX S

31 Vendor account KBS H

KBS is without any account determination and posting keys are 81 & 91. It triggers when there is nomaterial is assigned in the PO at that time.WRX In case of any posting required without material, account determination should be withoutvaluation class.

If price changed at the time of IR, then based on the difference in the material price system postsamounts to particular material account and not to the price difference account (this is related to thematerials with price control V).Material Valuation: MMMovement type -TCODE - MR22 Dr/Cr Material material valuation (below given calculation) & MR21: Price Change(Difference amount posts to the material account and calculation is ((New price Old price) * Quantity)FI Document Type - PR: Price change Below entry in case of price increase

89 Raw material BSX S

93 Material Valuation UMB H

Calculation - {Current Stock Value + (Amount given in MR22 / Quantity given in MR22 * Cr. Quantity)}Billing Document: SDTCODE - VF01 Billing - VF11 Cancel Billing

FI Document Type - RV: Billing document transfer - RW: Reversal of billing01 Customer account BSX S

50 Sales Revenue account UMB H


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InvoiceVerification for

ForeignVendorOn

receipt of vendorbill the following

entry will bepassed:GR/IR A


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ccount DRVendor Account CRIn

voiceVerification for

CustomvendorOnreceipt of

Vendor bill the


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follo wing entrywill be

passed:1) RG 23A/RG 23C Part

2 A/c(CVD) A/c DRCenvat Clearing A

/c CR2) G/R I/R


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A/c DRCenvat Clearing A/c DRVendor A/c CR3)Cost of MaterialA/c DRVendor A

/c (Customs) CRInvoice

Verification for


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Freight /Clearing

AgentCost of Material A/c DRVe

ndor A/c(Clearing

Agent) CRInvoic

e Verification for


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OctroiExpensesCost of Material DRVendor A/c (Octroi)

CRTDS (WorkContract Tax)

for Service

Orders shall be


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calculated anddeductedaccordi

ngly.Thefollowing entrywill be passed

on billpassing:Expens

es Account DRV


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endor AccountCRTDS AccountCRThe material

shall be returnedto the vendor

using theReturnto vendor

movement type


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in SAPCreatinga ReturnPOThese

transactions willbe processed in

the MMmodule.The

accounting


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entries will be:Returns after

GRNGR/IR A/cDrStock A/c CrThe accounting inrespect of debit /

credit memos

for FI vendors,


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the processwillbe similar tothat of invoice

processing. Theaccounting

entrieswill be:On issue

of debit note


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Vendor AccountDRExpenses Ac

count CRInrespect of importvendor - capitalgoods exchangedifferences are

to beaccounted


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manuallythrough a

Journal Voucherfor

capitalization.Exchange rate

differences will

be accounted at


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HO. An exampleof theaccounting

entry in thiscase shall

be:Invoice entry@ 40 INR: 1

USDAsset / Exp

ense A/c DR 10


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0Vendor A/c CR100Payment

Entry @ 41 INR:1

USDVendor A/cDR 100Bank A/cCR 110Exchan

ge rate loss Cap


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ital A/c DR 10Asset A/c DR 10Exchange rate lossCapital A/c CR10A new G/L

account shall becreated for the

special G/L


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transactions.Theaccounting entryfor making thedown payment

shallbe:Advance to s

upplier

account DebitBa


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nk A/c CreditWhen the invoice is

booked thefollowing entry ispassedGR/IR account DebitVendor account Credi

tClearing of


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Invoice againstDown

PaymentVendorA/c DebitVendo

r down paymentaccount CreditWherever, TDS is

applicable, the


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TDS will bededucted at thetime of down-

payment to thevendor.DownPayment for

Capital

(tangible)


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AssetsDownpayment tovendors for

capitalacquisitions is to

be reportedseparately inthe

Balance Sheet


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under thehead Capital

Workin Progress. He

ncedownpayment

for capital goods

would be


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tracked througha separate

specialgeneralledgerindicator.The

procedure to befollowed

is:Definition of


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alternativereconciliationaccounts for

AccountsPayable forpostingdown

payments made

for Capital


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assetsClearingthe down

payment inAccounts

Payable with theclosing invoice.

A new G/Laccount shall be


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created for thespecial G/L

transactions.Theaccounting entryfor making thedown paymentshall be:Vendor

Advance for


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Capital GoodsAccount

DebitBank A/c CreditWhen the

invoice isbooked the

following entry is

passedAsset A/


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c /Asset WIP DebitVendor A/c Cred

itClearing ofInvoice against

DownPaymentVendor

A/c DebitVendo


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r Advance forCapital Goods

AccountCreditThe

Following arethe TDS Rates

(to be confirmed

with the recent


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changes)Particulars Tax Rate

Surcharge RateTotalContractors 194 C 2% 5%2.10%Advertisin

g 194 C 1%

5% 1.05%Prof.


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Fees 194 J5% 5%

5.25%RentOthers

194 I

15% 5%15.75%Rent

Company 194

I 20% 5%


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21%Commission

194H 5%5%

5.25%Interest -Others 194A 10% 5%

10.50%Interest

Company


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194 A 20% 5%21%Special

ConcessionalTaxWorksContract

TaxSECURITYDEPOSITS

/EARNEST


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MONEYDEPOSIT

RECEIVEDFROMVENDORSBank A/c DRSecurity DepositVendor CREMD

to give the age


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so as to enablethe same to betransferred to

unclaimedEMDaccount.PAYME

NT OF TOURADVANCE

DOMESTIC


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TOURSEmployee Advances willbe paid by the

AccountsDepartment unit

wise basedonthe requisition

or


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recommendation of the

respectivedepartmental

head.EmployeeTravel

Advance A/c DR


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Cash / Bank Account CR

mm process entries

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