The Use Tax Accrual feature had been found to experience the following issues when the Include Purchase Taxes in Project Costs option is selected on the Project Setup window (Tools » Setup » Project » Project).
IMPORTANT: It is NOT recommended to have the Include Use Taxes in Project Costs option selected when using the Use Tax Accrual feature.
NOTE: This issue applies if you are using Project Accounting, a “Time and Materials” Project Type, and while entering Drop Ship purchase order transactions.
Please see Pop Project Accounting FAQ for help with including purchases tax in a project's costs.