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Learning Centre > Purchases > Purchase transactions
Australia
Purchase transactions Entering details of purchase transactions is a common activity you will perform in your MYOB software. All purchases of inventory are to be recorded using the Purchases - New Item window, while cash purchases of non-inventory items or services are to be recorded using the Spend Money window in the Banking Command Centre. Your MYOB software then uses this information to record the journal entry and post the transaction to the appropriate general ledger accounts. The appropriate supplier balances are also automatically updated. This topic demonstrates how to record different types of purchase transactions, from converting a purchase order to a purchase invoice (bill) to recording credit and cash purchases (and everything in between!).
Helpful Hint! If you are completing our software practice set, you are asked to record purchases of inventory into the Purchases - New Item window and cash purchases of non-inventory items or services using the Spend Money window in the Banking Command Centre.
The following topics are covered: Converting a purchase order to a credit purchase Recording credit purchases Recording part cash part credit purchases Recording cash purchases of inventory with an invoice
Converting a purchase order to a credit purchase The process of converting a purchase order to a credit purchase in your MYOB software involves converting the previously recorded purchase order to a purchase invoice (bill). To do this, first you need to find the purchase order in your MYOB software. In the Purchases Command Centre, select Purchases Register.
This opens the Purchases Register window. The following screenshots and reference table show step-by-step instructions on how to convert the purchase order to a purchase invoice (bill). Note that each step is assigned a reference number to help you identify the appropriate field or icon in the screenshots. The Purchases Register window - converting a purchase order to a credit purchase
The Purchases - New Item window - converting a purchase order to a credit purchase
Step MYOB software field or icon
Action
Purchases Register window Orders tab
Click the Orders tab to be able to view the purchase orders for the dates specified.
Search by
Select All Suppliers if you wish to display the purchase orders for all suppliers. Select Supplier to view all purchase orders to one specific supplier. Note that if you choose Supplier, an additional drop down field will automatically be displayed next to the 'Search by' field. Click the search icon in this new field to display the Select from List window where you can select the specific supplier relating to the purchase orders you wish to view. Click the Use Supplier button to select that supplier.
Dated From, To
Enter the date range for the purchase orders you wish to view.
Purchase order list
In the list, identify the purchase order you wish to change to a purchase invoice (bill). Select this purchase order by clicking on it.
Change to Bill
Click the Change to Bill button to open the Purchases - New Item window for that purchase order.
Purchases - New Item window BILL tab
Notice that the Purchases - New Item window displays the BILL tab and is coloured blue, the colour your MYOB software uses for purchase invoices (bills). All of the information from the purchase order has been transferred to this bill.
Date
Enter the date of the invoice, that is, the date the goods are received.
Bill, Received, Backorder
Your MYOB software automatically populates the Bill and Received columns with the number of items ordered. If you received less than the number of items ordered in the purchase order, enter the number of items still to be delivered in the Backorder column. The purchase order will be updated to show the number of items yet to be received.
Helpful hint!
Record
You can add additional items of inventory to this invoice by entering the details in a new row. For details of how to enter this information, see steps 7 - 10 in the following topic, Recording credit purchases. Check that all the details in the purchase invoice (bill) are correct and click the Record button to record the purchase. You may be presented with a popup that says "This purchase is pre-dated. Click cancel if you do not wish to record it." Please click OK.
Recording credit purchases Recording a credit purchase of inventory from a supplier into your MYOB software is very similar to recording a purchase order, except that you select BILL rather than ORDER in the Purchases - New Item window. To record a credit purchase into your MYOB software, open the Purchases Command Centre and select Enter Purchases.
This displays the Purchases - New Item window. In the top left hand corner of this window there is a field from which you can choose QUOTE, ORDER, RECEIVE ITEMS or BILL. If BILL is not already displayed in this field, click the arrow next to this field and change the field to BILL.
Helpful Hint! If you are completing our software practice set and the title of the window is not Purchases - New Item, it is because your MYOB software is displaying a different layout for that window. To change this to the Purchases New Item window, click the Layout icon at the bottom of the window. In the Select Layout window that appears, select Item and click the OK button. The title of the window should automatically change to Purchases - New Item. You should now notice that the colour of the window has turned blue, the colour your MYOB software uses in the Purchases - New Item window to indicate that you are recording a purchase invoice (bill). Here, you can enter the details of the credit purchase into your MYOB software. The following screenshots and reference table show stepby-step instructions on how to enter a credit purchase into the Purchases - New Item window. Note that each step is assigned a reference number to help you identify the appropriate field or icon in the screenshots.
The Purchases - New Item window with reference numbers
Step MYOB software field or icon
Action
Supplier
Click the search icon to open the Select from List window where you can select the supplier to which the purchase relates to. Click the Use Supplier button to select the supplier. Notice that when you select the supplier, your MYOB software automatically populates certain fields with information about the supplier that you entered when you added the supplier into your MYOB software during the setup process. You can accept that information or manually change it for this purchase.
Terms
This field is automatically populated when you select the supplier. You can accept this information or change it for this purchase by clicking on the zoom arrow.
Ship to
This field is automatically populated with the name and address of your business that you entered when you set up your company file.
Purchase #
Accept the purchase number your MYOB software automatically assigns to this bill or enter the purchase number you wish to use.
Date
Enter the date of the credit purchase.
Supplier Inv#
Enter the supplier's invoice number in the Supplier Inv# field if known.
Bill, Received
Enter the quantity of the first item ordered. Notice that when you click out of the Bill column, your MYOB software automatically populates the Received column with the number of items entered into the Bill column.
Item Number
Enter the item number of the item of inventory purchased. If you do not already know the item number, click into this cell to select the cell. You should notice that a box appears around the cell. You should then press on your keyboard to display the Select from List window where you can scroll through the list of inventory items. Click on the appropriate item of inventory to select it, then click the Use Item button.
Description
When you select the item of inventory using the Item Number field, your MYOB software automatically populates this field with the longer description of the item of inventory. Read this description to check that you have selected the correct item. Then press on your keyboard to move to the next field.
Price, Total, Tax
If you have purchased this item before, your MYOB software automatically populates the price field with the last price paid for that item of inventory. You can either accept this price or enter a new price into this field. Note that if you change the price, your MYOB software automatically calculates the new Total for that number of items. Alternatively you can change the amount recorded in the Total column and your MYOB software will calculate the percentage discount and record it in the Disc% column. If this is the first time you are purchasing that type of inventory, enter the price of one unit of that inventory item into the Price field. Your MYOB software automatically calculates the total for that number of items. Your MYOB software automatically populates the Tax column with the default information specified when that item of inventory was set up.
Helpful hint! Record button
You can enter additional items of inventory ordered by repeating steps 7 to 10 in a new row. Once you have reviewed the information entered for the purchase, remember to click the Record button to record the purchase.
Recording part cash part credit purchases Recording a part cash and part credit purchase involves recording the full amount of the purchase into the Purchases - New Item window, just like recording a credit purchase. Then, the cash payment is recorded separately in the Pay Bills window. Note that you are able to record any cash payment made to the supplier while recording the credit purchase in the Purchases - New Item window. However, if you are completing our software practice set we recommend that you use the Pay Bills window to record the cash payment. This is because the Purchases - New Item window does not show all line items in which you are able to view and record the details of the cash payment.
For instructions on how to record the purchase into the Purchases - New Item window see the Recording credit purchases instructions as just described. Then, in the Purchases Command Centre select Pay Bills to open the Pay Bills window.
This opens the Pay Bills window where the payment to the supplier can be recorded. The following screenshots and reference table show step-by-step instructions on how to record the cash payment to the supplier into the Pay Bills window. Note that each step is assigned a reference number to help you identify the appropriate field or icon in the screenshots. The Pay Bills window with reference numbers
Step MYOB software field or icon Selecting the account
Action There are two options to select the general ledger account from which the payment will be recorded. Pay from Account: If the payment is to be made directly from a bank account, such as for a cheque or credit card payment, select the Pay from Account option. Then click the search icon to open the Select from List window where you can select the general ledger account that records payments from that bank account. If you are completing our software practice set, for cash payments made to suppliers that the business pays by cheque, you are asked to select the Pay from Account option and then select the Cheque Account. Group with Electronic Payments: Select this option if you are going to include this payment with a group of electronic payments. Once all electronic payments have been recorded in the Pay Bills window, you can then use the Prepare Electronic Payments window in the Banking Command Centre to make the electronic payment. If you are completing our software practice set, you are not required to make electronic payments.
Supplier
Click the search icon to open the Select from List window where you can select the supplier to which you are making the payment. Click the Use Supplier button to select the supplier. Notice that when you select the supplier, your MYOB software automatically displays the purchase invoices (bills) yet to be paid to that supplier. These invoices are known as open bills.
Payee
Your MYOB software automatically populates this field with the name and address of the supplier you selected. Note that the Payee field is not displayed if you selected Group with Electronic Payments.
Memo
Type in a description of the transaction or any other relevant information.
Cheque No.
Accept the cheque number your MYOB software automatically assigns to this cash payment or enter the cheque number you wish to use.
Date
Enter the date of the cash payment.
Amount
Enter the full amount of the cash payment, including tax if applicable.
Amount Applied
Find the invoice (bill) you wish to apply the cash payment to and click in the cell in the Amount Applied column for that invoice. Notice that your MYOB software then automatically populates this cell with the amount recorded in the Amount field.
Out of Balance
This cell reports the difference between the amount entered in the Amount field and the total of the Amount Applied column. Check that the out of balance amount is $0.00 otherwise you will not be able to record the payment. If you have just entered an amount in the Amount Applied column or the Amount field, you may need to click out of these cells before your MYOB software recognises the amount you have entered into those fields and automatically updates the Out of Balance field.
Record
Check that the details entered into the Pay Bills window are correct and the click the Record button to record the payment.
Recording cash purchases of inventory with an invoice To record a cash purchase of inventory with a purchase invoice, follow the process to record a part cash and part credit purchase. The only difference is that you enter the total value of the invoice in the Pay Bills window rather than a partial cash payment.
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