Hi Mike,
Thank you for getting back to me. I only work part time, so today is first day back in the office since posting my question.
I have attached a screen shot of the GL which relates the the transaction in the screen shots previously provided.
I don't believe the COGS account is the issue. I believe the fact that the journal created in the background by MYOB DR's and CR's the asset account is the issue. I believe one side of the transaction should be going to the COGS account when it is not.
I have run an inventory variance report on 31st October and again on 1st November. There is movement in the variance by $21.79 in finished goods and $15.53 in raw materials. This is what leads me to believe the variance is caused by MYOB DR'ing and CR'ing the same asset account, instead of the COGS.
If the DR to raw materials of $15.53 and the CR to finished goods of $21.79 was not being posted to those asset accounts, there would be no change to the variance on the inventory variance report.