My question is about the impact of GRNI on the Profit and Loss statement.
I know that GRNI is a liability that is acrrued because stock is received. That is Dr Stock Value £100, Cr GRNI £100 and I know that when the invoice is later received then this accrual is cleared Dr GRNI and Cr Purchase Control.
BUT please explain to me what happens in terms of COST OF SALE in the P&L? That is what effect does building up a GRNI accrual and not resolving this by month end have on the Cost of Sale? How does this GRNI impact on the COS equation Opening Stock +Purchases - closing stock?