Stephensan, Thanks for your reply.

> I don't have an accountancy background but one of my clients is pretty good 
> at putting up with my questions and anything you're having an issue with is a 
> learning oppurtunity for me. 


I have installed the UK chart of accounts module which gives me all of the 
accounts and tax codes etc which is great for what we want. My plan was to get 
the system functioning using a minimal chart and then our accounts guys can 
build upon that framework.

I was running through the system with our finance manager, we set up a demo 
company, added partners, products and tested purchase and sales workflows which 
was all fine until we checked the accounting effects and realised the balances 
were a bit strange.

The main issue we have is when we purchase stock the current asset balance is 
£0.00 which gives an overall loss on the balance sheet. My understanding of 
double entry accounting is that purchased stock is an asset and therefor until 
it is sold the overall balance should be £0.00 and not a negative figure.

I'm not really sure about how I go about configuring the accounts so that the 
correct accounts are credited/debited when a transaction occurs.

I have an account under the 'Current Assets' account which is called 'Purchased 
Stock' I would like to know how to configure this account to be credited 
accordingly when stock is purchased.

I don't mind getting my hands dirty to fix this because I'm sure a wealth of 
knowledge will come as a result. I just don't seem to be able to find a 
starting point.

Any help with this will be greatly appreciated.

Thanks again for your time,

Alex




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http://www.openobject.com/forum/viewtopic.php?p=38455#38455

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