Inventories and their accounting

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Each organization must take into account inventory items that are part of the working capital of the enterprise. Usually they are intended to provide or participate in the production process for a period of no more than one cycle, after which they are fully or partially included in the price of the goods.

Inventory accounting begins with settlement documents received from product suppliers regarding payment for raw materials or materials on the basis of a bilateral agreement concluded before. Thus, the buyer enterprise receives a certain set of accompanying documents obliging to transfer the amount of money indicated in them to the supplier's account. Such documents include invoices, payment request-orders, waybills and so on. All inventory items and any of their movement must be reflected in accounting, that is, their receipt and disposal are recorded in specialized books. All pages of every bookaccounting must be laced, numbered, certified by the seal of the enterprise. Often they are stored in the chief accountant's safe, and after use they are archived for at least five years.

The material warehouse also keeps a record of all incoming and outgoing goods. In this case, the storekeeper is obliged to keep all the primary documentation, make the necessary entries in his working documents, and then transfer the primary to the accounting department. As a rule, the transfer of documentation to the accounting department is carried out within the period established by the enterprise, but at least once a week. Inventory assets are accounted for on the "Materials" account, and their receipt is reflected in debit, and disposal - in credit. If an enterprise purchases goods and materials, then a similar amount is reflected in the credit of the account “Settlements with accountable persons” (when paying for cash at the cash desk or transferring funds by bank transfer). If they are produced thanks to their own subsidiary farm, then the Auxiliary Production account is used for the loan.

As a rule, inventory items are issued from a warehouse for on-farm use or participation in the production process. In most cases, the write-off of goods and materials from the warehouse implies an intra-factory movement of materials. In this case, standard unified forms of documents are used, for example, picking lists, limit-fence cards, cutting cards. In addition, the issuance of anyraw materials are produced only within the limit established by the accounting policy. If the release is required in excess of this limit, then the storekeeper can implement it only on the basis of the permission of the director, engineer or other authorized person.

All enterprises regularly carry out an inventory of inventories. It is carried out by a commission specially formed for this purpose on the basis of an appropriate order signed by the head. Inventory involves a piece-by-piece recalculation of all materials present in the warehouse, and reconciliation of the obtained data with the available figures in the documents.