Inventory Posting

Traditionally Financial and Costing records were seprately maintained. In the ERP scenario both are merged. Therefore the way transactions are done is different.
With a purchase transaction the following entry should be created :
Inventoy Account ...... Debit
Vedor Account ...........Credit.

There are different occasions where both the accounts should be posted such as Inventory account should be debited when there is receipt of goods and vendor account should be credited when the purchase invoice is booked in the system. Receipt and invoicing can occur at different times therefore the system has created two transactions:
Receipt : Inventory Account ...Debit
Direct Cost Applied..Credit

Invoice: Purchase Account.....Debit
Vendor Account .....Credit
Purchase and Direct Cost Applied account are Income Statement accounts and gets nullified. When ever the goods are sold that is debited in COGS account which is the net consumption for which the exp is booked for that year/transaction/period.

Reciept is Costing which is directly related with Inventory Posting Group.
Invoice which is related to Customer Posting Group & is Financial.