Direct Cost applied account

Lisa_Randall

Would soeone be able to explain to me what the purpose of the direct cost applied account is please?

ara3n

For manufacturing you use it for labor.

For purchasing. When the Invoice is posted the following entries are made.


+ Purchasing account
- Account Payables
+ Inventory Account
- Direct Cost Applied account


In earlier version The Inventory Adjmt. Account was used instead of Direct cost applied account.

veerabhadra

Hi

Direct cost applied A/c is an offset account in P&L against direct material purchase A/c

When Inventory batch job was executed the cost of material purchases will be credited to Direct cost applied A/c and debited to Inventory A/c.

Regards
Veerabhadra

Lisa_Randall

Thanks !!!!:)