What is GR/IR Accounting Entries and What Journal Entries One Should Pass for This?
The GR/IR – the goods receipt/Invoice Receipt account is used to post to whenever goods that are not yet invoiced have been received or when invoices arrive b4 the the delivery of goods.
During the time between the invoice being created and delivery of goods, there can be a timing difference, in order to accommodate this timing difference; a GR/IR account is maintained temporarily to record the flow.
There is a time difference between goods reciept and invoice reciept .
To accommadate these time difference we can use GR/IR CLEARING A/C(Goods reciept/invoice reciept a/c). No need to pass any entry for this purpose.
System will pass entries automatically based on our account assignment.
Entries are given below:
GOODS RECIEPT :
Inventory RM A/C Dr
To GR/IR Clearing A/C
GR/IR Clearing A/C Dr
To Vendor A/C