Concept

Using a price correction when a supplier sends an invoice for a change in unit price for an invoice you have matched to a purchase order. You can record a price correction by entering a standard credit or a debit memo invoice and then checking Price Correction when you perform matching. Payables records and updates the invoiced unit price of previously matched purchase order shipment or distributions without adjusting the quantity billed so you can track price variances; Payables also updates the amount billed on the original matched purchase order distributions.

AP Invoice +$20

Price correction

AP Invoice $500

PO Match

PO $500

Price correction

Credit Memo -$30

Increase for a PO
Current PO status

Current Invoice Status

DR. [AP Accrual] Liability-Accrual Stock $10470 CR. [Liability] Liability-Trade Creditors $10470

Step 1: Create an invoice

Step 2: Match PO with Price correction

At the finding form, click the Price correction and the POs original Invoice Number

At the matching windows input the amount to increment.

Step 3: Validate Invoice and release hold

Well get the invoice hold Invoice price exceeds purchase order price

Step 4: Create accounting

DR. [Invoice Price Variance] Liability-IPV $300 CR. [Liability] Liability-Trade Creditor $300

Final PO status
Original PO and Invoice doesnt change.

Decrease for a PO
We use the same case with previous Price Increment

Step 1: Create an Credit Memo

Step 2: Match PO with Price correction

At the finding form, click the Price correction and the POs original Invoice Number

Step 3: Validate Invoice

Step 4: Create Accounting

DR. [Liability] Liability-Trade Creditors $600 CR. [Invoice Price Variance] Liability-IPV $600

Final PO Status
PO and the original Invoice has no change.