Implementing COGS with multicurrency

[Alun Champion]

You should check with a tax professional when you should count the
asset in your home currency but here's how it could work. If you
receive and sale at the same time then the first 2 transactions could
collapse to one and you wouldn't need the Tickets account.

Receive tickets for resale (immediately book in home currency):
Liabilities: A/P: (EURO 100)
Assets: Inventory: Tickets: $130
Trading: EUR: EURO 100
Trading: USD: ($130)

Sell ticket - direct payment (alternatively use a A/R account to
separate customer sale and payment)
Assets: Account: $140
Income: Sales: ($130)
Income: Fee: ($10)
Assets: Inventory: Tickets: ($130)
Expense: COGS: $130

Pay vendor for tickets:
Liabilities: A/P: EURO 100
Assets: Account: ($140)
Trading: EUR: (EURO 100)
Trading: USD: $140
Trading: USD: ($10)
Expenses: Currency Loss: $10



On 31 January 2014 01:08, Vladimir Avramenko
<vladimir.avramenko at gridnine.com> wrote:
> There is perfect explanation for the process with single currency given in
> http://permalink.gmane.org/gmane.comp.gnome.apps.gnucash.user/44097
>
> Could someone please give me the similar scheme for the case of two
> currencies. Namely:
> 1. Suppose my Company resells air tickets in USD.
> 2. Company takes a ticket from Vendor (Vendor works with EUR, and the ticket
> costs 100 EUR)
> 3. Company resells ticket to Customer in USD with rate EUR = 1.3 USD plus
> Company takes an additional Fee 10 USD from Customer
> 4. Company pays 100 EUR to Vendor with rate EUR=1.4 USD
>
> It is preferable to use Trading account because, according to article
> http://www.mathstat.dal.ca/~selinger/accounting/tutorial.html, it is the
> most correct way to deal with multicurrency.
> ______________________
> Thank you in advance,
> Vladimir
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