How to Record FMS Transportation Costs
Accounting for shipping and handling costs for defense articles sold via the Foreign Military Sales (FMS) program.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Direct FMS Shipping Expense | Debit | 8,500.00 | - |
| Accounts Payable | Credit | - | 8,500.00 |
💡 Accountant's Note
FMS contracts often have specific crating, handling, and transportation requirements that are charged directly to the FMS case rather than through indirect pools.
Practitioner & Systems Framework
💻 ERP Architecture
Linking third-party shipping invoices to the specific FMS contract line item (CLIN).
⚠️ Audit Flags
Verification that FMS shipping costs are not also included in indirect material handling pools (double dipping).
📄 Required Documentation
Bills of Lading, FMS Case Letter of Offer and Acceptance (LOA), and carrier invoices.
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Discussion & Community Questions
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