Simple Accounting Entries in Payables

  At the time of invoice (For inventory item)

Inventory AP accrual a/c Dr
To AP liability a/c Cr
At the time of invoice (For Expense item) Charge a/c Dr
To AP liability a/c Cr
At the of Payment AP liability a/c Dr
To Cash Clearing a/c
Prepayment Entry Prepaid a/c Dr
To AP liability a/c Cr
AP liability a/c Dr
To Cash Clearing a/c Cr
Cash Clearing a/c Dr
To Cash or bank a/c Cr
Adjustment of prepayment against Invoice AP liability a/c Dr
To prepayment a/c Cr
Credit memo or debit memo entry AP liability a/c Dr
To charge a/c or Inv AP accrual a/c
With holding Tax Entry AP liability a/c Dr
To Withholding Tax a/c Cr
Releasing With holding Tax Withholding Tax a/c Dr
To AP Liability a/c
Purchase price variance Entry Material a/c Dr
To Receiving a/c Cr
To PO price Variance a/c Cr
If standard price is less than PO price
Material a/c Dr
To PO price variance a/c Cr
To Receiving a/c Cr
Currency Gain Entry AP liability a/c Dr
To realized gain a/c Cr
To Cash a/c Cr

Currency LossAP liability a/c Dr
Realized Loss a/c Dr
To Cash a/c Cr
For future dated Payment AP liability a/c Dr
To Future dated payment a/c Cr
At payment Maturity Future Payment a/c Dr
To cash a/c Cr
Discount takenAP Liability a/c Dr
To System discount a/c Cr
To cash a/c Cr
Cross currency Entry Charge a/c Dr
To Liability a/c Cr
Cross currency Payment time Entry Liability a/c Dr
Rounding a/c Dr
To cash clearing a/c