Quote from Lynn_Pantic on 09/21/15 at 09:46:36:The cost goes to WIP when the PO is received. it is not an expense, it is an increase in the WIP Asset value. It becomes part of the Finished Good value in Inventory (again, asset account) when Enter Finished Production is performed and becomes COGS expense when the item is shipped. Purchasing of raw materials, components and outside processing should never be an expense, it is an increase in asset value.
Will the purchase of raw material get out of the WIP Account and eventually get back into the COGS expense? I think it has to, but I don't understand how? We enter finished production but it doesn't effect our GL. I think I have that turned off.
Thanks
Laura