How Do I Import Raw Materials?

Imported materials accounted for inventories purchased by foreign-invested enterprises. In addition to domestic purchases, some were purchased from abroad.

Accounting of imported materials

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Accounting of imported materials

Accounting of imported materials

Because the import price conditions and settlement methods of foreign imports are different from domestic purchases, their cost composition and account processing have different characteristics:

1. Price conditions in international trade. There are three main types, namely FOB price, CIF price and cost plus freight price.

(1) FOB price (F.O.B). The seller is only responsible for loading the goods on the vessel (or other means of transportation) designated by the buyer within the specified port and time limit, and is responsible for paying all the costs up to the time of shipment. Under this price condition, the buyer must pay the freight and insurance costs from the port of shipment to the port of destination in addition to paying the purchase price based on the invoice price of the purchased goods and materials.

(2) CIF (C.I.F). The seller is responsible for loading the cargo on board and paying the freight and insurance costs from the port of departure to the port of destination. The buyer collects the goods at the port of destination, and bears all expenses incurred during the transportation of the goods except freight and insurance, and the costs of unloading the goods at the port of destination.

(3) Cost plus freight (C.F.R.). The seller is responsible for loading the cargo on board and paying the price conditions for the freight from the port of departure to the port of destination. The buyer shall insure himself and pay the insurance premium. F. R. The conditions are the same.

2. Purchase material accounting. For the calculation of imported materials, the actual cost is generally used. The purchase cost of imported materials includes foreign purchase price and entrance tax. The foreign purchase price is usually based on the CIF price. For imported goods traded at FOB prices, the foreign freight and insurance fees paid should be added to the foreign purchase price.

Materials imported by enterprises exclusively for the manufacture of export goods are exempt from import taxes. For imported materials, a detailed account should be set up for detailed accounting. If the currency used to purchase the materials is not consistent with the reporting currency, in addition to recording the amount of sending and receiving deposits and the unit cost deduction based on the reporting currency, each batch should be specified. The purchase price of foreign currency units for imported materials, the amount of foreign currency in the purchase price, the amount of foreign currency for transportation and miscellaneous charges, the amount of standard currency for shipping and miscellaneous charges, the amount of standard currency for import tariffs, and the amount of all actual costs.