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10.7 Luxembourg PCN Class 3 Inventory Accounts

PCN Class 3: Inventory​

Class 3 in PCN contains all inventory-related accounts.

Account Ranges:

  • 300000-309999: Raw Materials (Matières Premières)
  • 310000-319999: Work in Progress (En Cours de Fabrication)
  • 320000-329999: Finished Goods (Produits Finis)
  • 321000: Merchandise (Marchandises)

Main Inventory Accounts​

300000: Raw Materials​

Use:

  • Materials to be used in production
  • Ingredients for manufacturing
  • Components to be assembled

Example: Manufacturing business

300000 Raw Materials              €5,000

310000: Work in Progress​

Use:

  • Products partially completed
  • Manufacturing in process
  • Construction in progress

Example: Manufacturing business

310000 Work in Progress           €3,000

320000: Finished Goods​

Use:

  • Completed products ready for sale
  • Manufacturing businesses
  • Products awaiting sale

Example: Manufacturing business

320000 Finished Goods             €8,000

321000: Merchandise​

Use:

  • Goods purchased for resale
  • Retail businesses
  • Wholesale businesses
  • Restaurants (retail items)

Example: Retail store

321000 Merchandise                €15,000

Inventory Sub-Accounts​

Can Create Sub-Accounts:

  • 321001: Merchandise - Category A
  • 321002: Merchandise - Category B
  • 300001: Raw Materials - Type X
  • 300002: Raw Materials - Type Y

Purpose:

  • Better tracking
  • Multiple product types
  • Different VAT rates
  • Better management

Cost of Goods Sold Accounts​

PCN Accounts:

  • 602000: Cost of Goods Sold (CoĂ»t des Marchandises Vendues)
  • 601000: Cost of Raw Materials Used (Consommation de Matières)
  • 603000: Cost of Finished Goods Sold (CoĂ»t des Produits Vendus)

For Retail Businesses:

  • Use 602000: Cost of Goods Sold

For Manufacturing:

  • Use 601000: Cost of Raw Materials
  • Use 603000: Cost of Finished Goods Sold

Inventory Valuation Accounts​

Allowance Accounts:

  • 390000: Allowance for Inventory Depreciation (DĂ©prĂ©ciation des Stocks)

Use:

  • When inventory value is below cost
  • Write-downs to net realizable value
  • Obsolete inventory

Luxembourg Compliance Note​

PCN Class 3 inventory accounts must:

  • Be properly classified
  • Use correct account numbers
  • Support inventory values
  • Enable proper cost of goods sold calculation
  • Support financial statement presentation
  • Comply with PCN requirements

Think It Through​

How does proper PCN classification of inventory accounts support accurate financial reporting and compliance in Luxembourg?