Materials in transit refer to materials that have been paid but have not been received or accepted for storage. Material purchase is used to calculate the purchase cost of purchased materials and determine the material cost variance. How to make an account for the purchase of goods in transit?

Accounting treatment of materials in transit

1. The payment has been paid or the commercial bill has been drawn and accepted, but the materials have not yet arrived or been accepted and put into storage.

Debit: materials in transit

Taxes payable-VAT payable (input tax)

Loans: bank deposits, etc.

2. After acceptance and warehousing:

Borrow: raw materials

Lending: materials in transit

Accounting treatment of material procurement

(1) The payment has been paid, and the materials are accepted and put into storage.

(1) Material procurement included in actual cost:

Debit: material purchase (debit, actual cost)

Taxes payable-VAT payable (input tax)

Loans: bank deposits, etc.

(2) Raw material income, calculated according to the planned cost:

Borrow: raw materials (planned cost)

Credit: material procurement (credit, planned cost)

③ Carry-forward material cost variance

Debit: Material Cost Variance (Debit Overexpenditure)

Loan: material procurement

And vice versa (credit savings)

(2) The payment for goods has been paid, but the materials have not been accepted and put into storage.

Borrow: material procurement (actual cost)

Taxes payable-VAT payable (input tax)

Loans: bank deposits

(3) The payment has not been paid, and the materials have been accepted and put into storage.

Borrow: material procurement (actual cost)

Taxes payable-VAT payable (input tax)

Credit: accounts payable/notes payable

Meanwhile:

Borrow: raw materials (planned cost)

Loan: Material Procurement (Planned Cost)

Debit: Material Cost Variance (Debit Overexpenditure)

Loan: material procurement

And vice versa (economic depression)

(4) Materials have been put into storage, but invoices and bills have not been received. At the end of the month, they should be accounted for according to the estimated planned cost.

What is goods in transit?

Accounting enterprises use actual costs for daily accounting of materials, commodities and other materials, as well as the procurement costs of various materials that have not yet been accepted and put into storage. This course should be detailed accounting according to the supply unit and material variety.

What is material procurement?

Material procurement is an accounting subject used to reflect and supervise the use of materials procurement funds, calculate the procurement cost of purchased materials, and determine the difference between actual cost and planned cost of materials.