When a customer returns an inventory item to your warehouse, the system generates GL entries to reverse the expense and add the item back into the inventory asset account. (Refer to the Order Return/Direct Return (Intracompany) transaction in the Accounting Activities Table.) The Inventory asset account (event ID A010) is debited and the Reserve for Inventory account (event ID A020) is credited. If a storage overhead is applied to the item, the Storage Overhead account (event ID A060) is also debited. An Expense Offset account (event ID A100) is debited and the Usage Expense account (event ID E010) is credited.

Note: If the customer had entered a specific expense account on the original usage order, then the system will credit that specific account when the return is processed.

Note: For returns against a usage order, the unit cost defaults to the items average cost at the time it was originally issued. If required, this default unit cost can be overridden at the time that the return is recorded in the NCAS.