Answer to Question #179073 in Accounting for Milan

Question

Debit Intercompany Cost of Goods Sold

Credit Inventory

Debit COGS

Credit Inventory

Are these two journal entries the same thing? (The First Journal is based on the Intercompany Transactions Chapter.) Thank you.

Answer 1

These are different operations.

In the first case, it is a transfer in the company between the enterprises of the group. For the second operation, this is a move within the enterprise