Accounting entries in Order to Cash cycle

A quick summary of accounting entries in Order to Cash cycle

    Sales order creation – No entries
    Pick release:
    Inventory Stage A/c…………………Debit
    Inventory Finished goods a/c……..Credit
    Ship confirm:
    Cogs A/c ……………………………Debit
    Inventory Organization a/c………Credit
    Receviable:
    Receviable A/c………………………Debit
    Revenue A/c………………………Credit
    Tax ………………..…………………Credit
    Freight…………..….……………….Credit
    Cash:
    Cash A/c Dr…………………………Debit
    Receivable A/c……………………….Credit

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 For Order to Cash Entries.


Step 1: Sales order creation - No entries


Step 2: Pick release : Inventory Stage A/c Dr
To Inventory Finished goods a/c

Step 3: Ship confirm : Cogs A/c Dr
Inventory Organization A/c.


Step 4: In Receviable : Receviable A/c dr
To Revenue A/c
To Tax
To Freight

Step 5: Cash : Cash A/c Dr
Receivable A/c cr