Account 611- Purchases
1. Accounting Principles
This account is used to record values of raw materials, materials, instruments tools and goods which are purchased and used during the period. Account 611 ―Purchases‖ is only applied to businesses which apply periodical inventory method.
b) Values of purchased row materials, instruments, tools, and merchandises shall be recorded on Account 611 ―Purchases‖ and carried out by original price principle.
c) In case of accounting for stock under periodical inventory method; Enterprises must carry out inventory at the end of accounting period, to determine quantities and values of each kind of raw materials, materials, goods, products, instruments and tools in store at end of accounting period, to determine value of stock delivered for use and sold in period.
d) Method of accounting for stock under periodical inventory method: When purchasing raw materials, materials, instruments, tools, merchandises, accountants shall base on purchase invoices, transportation bills, store order, import tax notice (or import duty receipt,...) to record original price of goods purchased at Account 611 ―Purchases‖. When delivering for use, or delivering for sales, goods are recorded just one time at end of account period based on inventory results.
dd) Accountants must open detailed book to account original prices of purchased stock in periods of raw materials, materials, instruments, tools, merchandises.

2. Structure and contents of account 611 - Purchases
Debit side :
- Transferring original price of merchandises, raw materials, materials, instruments and tools in store at beginning period (According to inventory results).
- Original price of merchandises, raw materials, materials, instruments, tools purchased during the period;
Credit side :
- Transferring original price of merchandises, raw materials, materials, instruments and tools in store at the end of period. (According to inventory results).
- Original price of merchandises, raw materials, materials, instruments, tools dispatched for used during the period or original price of goods delivered for sale (selling in period has not yet been determined);
- Original price of merchandises, raw materials, materials, instruments, tools purchased returned to the seller or discounted.
Account 611 does not have ending balances.
Account 611 comprises 2 sub-accounts
- Account 6111 - Purchases of raw materials, materials: This account is used to record values of raw materials, materials, instruments and tools purchased and delivered for usage during account period and to transfer values of raw materials, materials, instruments and tools which are in store at beginning and at the end of account period.
- - Account 6112. Purchase of merchandises: This account is used to record values of merchandises purchased and delivered for sales during account period, and to transfer values of merchandises in store at beginning and at end of account period.

3. Method of accounting for several major transactions
For manufacturing business in industry, agriculture, forestry, construction branches
- At beginning of account period, transferring values of raw materials, materials, instrument and tools in store at beginning of period. (According to physical inventory result at end of last period).
Dr 611 - Purchases (6111 - purchases of raw materials, materials)
Cr 152 - Raw materials, materials
Cr 153 - Instruments, tools.
- When purchasing raw materials, materials, instruments and tools, if input VAT is deducted, then original prices of raw materials, materials, instruments, tools purchased will be recorded in Account 611 (net of VAT), record:
Dr 611 - Purchases (price net of VAT)
Dr 133 - Deductible VAT
Cr 331 - Supplier payables (3311)
- When settling purchase money, if settlement discount is earned, record
Dr 331 - Supplier payables
Cr 111,112,...
Cr 515 - Revenues from financial activities (settlement discount)
- In case business purchases raw materials, materials, instruments and tools which do not meet specifications, categories or quality written in economic contract, or committed to return to sellers, or deducted in price:
Basing on values of purchases returns to seller, record
Dr 111, 112 (If collecting cash)
Dr 331 - Supplier payables (Deducted from suppliers payables)
Cr 611 - Purchases (6111) (values of raw materials, instruments and tools returned to seller)
Cr 133 - Deductible VAT (1331) (if any)
If business accept allowances for lot of goods purchased, allowances will be recorded a:
Dr 111, 112 (If collecting cash)
Dr 331 - Supplier payables (Deducted from suppliers payables)
Cr 611 - Purchases (6111) (Accepted Allowance)
Cr 133 - Deductible VAT (if any)
- At end of account period, basing on physical inventory result, accountants must determine real values of raw materials and materials in store at end of period, and real values of raw materials, materials and tools delivered for usage or for sales.
Transferring actual values of raw materials, materials in store at end of period (According to inventory results), record :
Dr 152 - Raw materials, materials
Dr 153 - Instruments, tools.
Cr 611 - Purchases (611)
Actual values of raw materials, materials, instruments and tools delivered for usage in production and trade in the period, record
Dr 621, 623, 627, 641, 642, 241,...
Cr 611 - Purchases (611)
Actual values of raw materials, materials, instruments and tools wasted or lost, accountants will base on shortage and loss report to record:
Dr 138 - Other receivables (1381)
Cr 611 - Purchases (611)
b) For business trading goods:
- At beginning of account period, transferring beginning inventory, record:
Dr 611 - Purchases (6112)
Cr 156 - Merchandises
- During the period, when purchasing goods which is eligible for input VAT deduction, base on purchase invoices and documents :
Actual vale of purchases, record:
Dr 611 - Purchases (6112)
Dr 133 - Deductible VAT (1331) (if any)
Cr 111, 112, 141; or
Cr 331 - Supplier payable (Total settlement price)
Expenses purchases actually incurred, record :
Dr 611 - Purchases (6112)
Dr 133 - Deductible VAT (1331) (if any)
Cr 111, 112, 141, 331,...
When settlement made before deadline, if business receives settlement discount on lot of goods purchased, record:
Dr 331 - Supplier payables ((Deducted from Account payable for sellers)
Cr 111,112,...
Cr 515 - Revenues from financial activities
Value of goods paid for sellers, record:
Dr 111, 112 (If collecting cash)
Dr 331 - Supplier payables ((Deducted from Account payable for sellers)
Cr 611 - Purchases (6112) (Purchase returns to sellers)
Cr 133 - Deductible VAT (1331) (if any)
Sales allowances accepted by sellers because goods did not meet proper quality, specifications written in contract, record:
Dr 111, 112 (If collecting cash)
Dr 331 - Supplier payables ((Deducted from Account payable for sellers)
Cr 611 - Purchases (6112)
Cr 133 - Deductible VAT (1331) (if any)
- At end of account period, accountants base on physical inventory results to determine value of inventory, value of goods consigned for sales (but are not conclusively yet sold), value of goods determined to be sold:
Transferring value of inventory and value of goods consumed for sales at end of period, record
Dr 156 - Merchandises
Dr 157 - Goods consigned for sales
Cr 611 – Purchases.
Transferring cost of goods sold,
Dr 632 - Cost of goods sold
Cr 611 - Purchases (6112)

Source: Circular 200, Article 83