Regarding Indirect Expense Maintenance in ERPNext

ERPNext Accounting
1

Hi All,

I am facing an issue over here. If I am creating a new child inside the Indirect expenses its coming as Cr(Credited) instead of Dr(Debited)

Sicne its an expense account, ideally it must be coming as 5000 Dr, when you take Chart of Accounts to see the details.

Please let me know a way by which it can be changed to Dr. I have finished my accounting for the year and I am encountering this problem. Please help.

Regards

2

@admins : Please help. Almost at the end of Financial year.

3

@rmehta : Any help which you can offer? Indirect Expense children which are currently listed as “cr” must be changed to “dr” so that Income - Expense reflects the Actual Profit/loss and doesn’t add up.

4

The “Dr” or “Cr” probably comes from whether the balance is negative or not.

5

@rmehta : Rushabh. I want to know how to go about this.

Say my Bank account has 5000 USD and from that I am having an expense which is 500 USD as Salary (which comes in Indirect expense).

How should I capture this in Journal Entry?

I am putting there as First row Bank account, I am putting in the Debit Column 500 USD.

In the next row i am selecting Salary account and 500 USD is automatically coming in the Credit Column.

But when I see the Profit loss statement, I am seeing - 500 USD in the Expense column.

As Profit/Loss is Income - expense, in ERP next its coming as 5000 -(-500) = 5500 USD, ideally the profit should be 4500 USD.

Please help in getting this sorted.

6

Can the admins please help?

7

Hello,

Your Journal Entry will be as follows.

Bank Account $500 Credit

Salary Account $500 Debit

Regards,
Prakash

8

Thanks Praksh sir, Can I know the reason also? Logically it must be the other way right?

9

For more details check:https://frappe.io/blog/erpnext-features/my-introduction-to-accounting-[part-1]