We have items in inventory with the 'normal' cost. What is the best way to purchase one of these items when they are on sale?
I don't want to change our normal system price for a possible one-time sale and I want the purchase order to accurately match the vendor's invoice, so I enter the sale price on my PO. With these sales items, we receive no terms discount for these items, so I don't need to add any discount amount when paying the voucher. All seems OK, but this will modify the G/L Purchase Price Variance account.
I haven't actually tried this, but I assume if I keep our system price on my PO and modify the payment to voucher via a discount, the Purchase Price Variance account won't be affected, but the Promotions and Discount Taken account would be modified. If this is true:
Which way is better? Is it basically splitting hairs and doesn't really matter? I personally don't care (I think), but the IRS may not view this the same way.
Does this difference from Standard cost and Actual cost also affect the Inventory Cost variance during manufacturing?