i entered a vendor bill with inventory items on it. the vendor bill has created a cost of sales adjustment to DR the expense and CR Inventory within the GL impact of the vendor bill. why is this happening?

AI generated answer (using internal Slack threads):

When you enter a vendor bill with inventory items, NetSuite automatically creates a cost of sales adjustment to debit the expense and credit the Inventory within the General Ledger (GL) impact of the vendor bill. This is because when you purchase inventory items, the cost of these items is initially recorded as an asset (Inventory) until the items are sold. When the items are sold, the cost of the inventory sold is moved from the asset account (Inventory) to an expense account (Cost of Goods Sold - COGS), reducing the inventory asset and recording the expense of the inventory items sold. This is done through a cost of sales adjustment. The GL impact of the vendor bill is as follows: - Debit (increase) the Inventory Asset account for the cost of the items purchased. - Credit (increase) the Accounts Payable account for the amount owed to the vendor. When the inventory items are sold, the GL impact is: - Debit (increase) the Cost of Goods Sold (COGS) expense account for the cost of the items sold. - Credit (decrease) the Inventory Asset account for the cost of the items sold. This is standard accounting practice for inventory items and is how NetSuite is designed to handle inventory accounting. If you want to impact an expense account directly when purchasing inventory items, you would need to use a different type of item, such as a non-inventory or service item, which do not have an associated inventory asset account and instead directly impact an expense account when purchased. ****** Disclaimer: This response was generated by an artificial intelligence assistant based on previous conversations from multiple Slack channels, and may contain inaccuracies or mistakes. ******