Hi,
@Tut @lubos @sharpdrivetek @Patch
i created a vatable inventory item and the tax was selected when i created the item. I raised a sales invoice with the inventory item. i found out that inventory-cost did not reflect the tax but it reflected on inventory-sales. i went to check P&L summary and it is showing loss already, which in reality it is not correct. Please help out. Thanks
you will have to provide screenshots of your sales and purchase invoice edit screens.
as far as i can understand, you have selected the Amounts are tax inclusive checkbox in your sales invoice whereas you have not done the same on your purchase invoice.
if you had done what i described above then Manager calculation is correct. you will have to edit either your purchase invoice or sales invoice and enter the correct values. read the guides section to understand more about Amounts are tax inclusive checkbox.
@sharpdrivetek thanks for replying. You are right about me selecting “amount are tax inclusive” on sales invoice, but I don’t have purchase invoice yet. I added inventory through inventory starting balance in inventory item. But am still concerned why tax would be removed on inventory- sales and leave inventory-cost.
I tried doing purchase invoice too with tax inclusive but inventory-cost on p&l is still without tax
The Inventory - cost account represents the transfer of the cost of inventory from asset to expense upon sale. No tax is ever involved.