I would like to know what is the correct way of posting parts purchased for future work orders. Eg. I would receive a deposit from customer for auto parts/ work order in June and I also purchased parts in June and July for this repair order . The repair order is not completed until August. What is the correct way of posting this transaction?

Since you speak of a job that is completed you will post the item to parts purchased as part of cost of sales.

If you want to have a more complex system you will have a work in progress account where you will accumulate costs and transfer these costs to cost of sales on completion

Thank you Paraclete. And if the job is not completed but parts are purchased for this job? How should I post it?Eg. Auto Parts purchased in July for a job that won't be completed until August 1. Should the parts still be posted as COGS- parts and then do an invoice for customer in August?These jobs are auto service jobs which usually completes within 30 days.