Transactions > Transactions examples - Income > Entering income for resale of commodities purchases
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Entering income for resale of commodities purchases
When buying commodities for use and resale, the initial purchase of a commodity such as fertilizer or chemicals will record the receipt of inventory as an expense. Ensure the expense account references the appropriate inventory account. This will display the commodity in inventory and will expense the purchase.
Record the sale as income to ensure the point of sale transaction records the resale of the commodity. Ensure the income account’s AgriStability code references account #9612 (Income from Resale of Commodities Purchased). This will reflect the reduced inventory and income from the sale.
Any amount of the commodity used by the farm operation requires an inventory adjustment transaction. This will reduce the inventory account by the amount of product used on the farm.
Other Information
Examples include the resale of seeds, fertilizers, chemicals and custom spraying.
Last updated on August 22, 2014 by FCC AgExpert