Expenses Included In Valuation

Freight, customs duty, insurance in transit and loading charges make the goods on the shelf cost more than the supplier's price. The Landed Cost Voucher spreads such charges over the items of a Purchase Receipt, raising their valuation rate, and it credits this ledger for the charges absorbed into stock while debiting Stock In Hand. The transporter's own bill is then posted as a Purchase Invoice debiting this same ledger, so the two cancel and the cost reaches the Profit and Loss only later, through Cost of Goods Sold when the goods are sold. If the freight bill goes to Travel Expenses instead, stock is undervalued and this ledger shows a stray credit.

New valuation rate = (Purchase cost + Landed charges) / Quantity received

1. 01Submit the Purchase Receipt for the goods first.
2. 02Go to Stock > Landed Cost Voucher > New and pick the Purchase Receipt.
3. 03In the Taxes and Charges table add the freight amount with Expenses Included In Valuation as the account.
4. 04Choose to distribute by amount or quantity and submit. The entry below posts and item valuation rises.
5. 05Post the transporter's bill with Buying > Purchase Invoice to Expenses Included In Valuation, clearing the credit.

Posted automatically by Landed Cost Voucher and the matching Purchase Invoice for freight. Review any leftover balance at month end.

Dr Stock In Hand Rs 5,000, Cr Expenses Included In Valuation Rs 5,000 for truck freight added to trekking gear from Birgunj.