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What are the use of Various Inventory Accounts in SAP Business One G/L Account Determination Configuration

  • October 25, 2023
  • Posted by: Caroline Ininga Majute
  • Category: SAP BUSINESS ONE TIPS
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  1. Inventory Account : This is the normal inventory account that is debited and credited when inventory transactions are made.  Examples of inventory transactions is when a Goods receipt note is posted in SAP Business one.  The inventory account is debited and GRNI(Goods received not invoiced account is credited). Another example of inventory transactions is when a Goods Issue is posted. The inventory is credited and a corresponding account is debited.
  2. Cost of goods sold account :  This account is debited when goods are sold. an example of a transaction that affects this account is the  SAP Business one Delivery document where the inventory account is credited and the Cost of goods sold account is debited. There is also a similar entry posted when an A/R document is posted without without a preceding delivery document.
  3. Allocation Account :  This account  is the account that is credited when a GRNI (Goods received not invoiced) is posted in SAP Business One.  This account is cleared when the supplier invoice is posted.
  4. Variance Account :  This account is used when the standard cost valuation method is used for inventory item valuation. if the price being posted varies from the standard cost set in the item master, the variance value goes to this account.
  5. Price Difference Account:  The price difference account  is used to post a price difference of an inventory transaction preceding another. For example, if the unit price on  a GRN is 10 and an invoice is posted based on the GRN whose  unit price is 11. There will be an entry in the price difference account.
  6. Inventory offset Increase Account: The stock offset increase account is used by the goods receipt document to add stock to the system from stock adjustment scenarios.
  7. Inventory offset Decrease Account: The stock offset decrease account is used by the goods issue  document to reduce stock to the system from stock adjustment scenarios.
  8. Sales Returns Account: This account is used when a the return document  or credit note document is posted. The idea behind the account is when you want to have a separate account to track the value of returned stock. If not required, the account set up for this can be the inventory account.
  9. Goods clearing account: This account is used when you manually close a GRN or goods return.
  10. G/L Decrease Account:  This account is used when you are revaluing your stock using the standard SAP Business one stock revaluation tool.
  11. G/L Increase Account: This account is used when you are revaluing your stock using the standard SAP Business one stock revaluation tool.
  12. Expense Clearing Account: This account acts as a clearing account when you post a GRN where freight is involved.  The account is credited with the value of the freight amount and the corresponding amount goes to the inventory account. When the supplier invoice is posted this account is cleared against the supplier account by a debit.
  13. Stock in Transit Account: This account is used when the A/P reserve invoice is posted.  This account is debited when the supplier account is credited. When you receive the goods from the supplier, this account is credited to clear it and the inventory account is debited to record the value of stock received.
  14. Shipped Goods Account: The shipped goods is debited when goods are shipped to the customer and  the delivery document is posted. This account is debited against the value of the stock shipped to the customer. This account is cleared against the Cogs account when the customer invoice is posted.


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