diff --git a/erpnext/accounts/report/deferred_revenue_and_expense/test_deferred_revenue_and_expense.py b/erpnext/accounts/report/deferred_revenue_and_expense/test_deferred_revenue_and_expense.py
index f8a965b699c..983eb0ee6af 100644
--- a/erpnext/accounts/report/deferred_revenue_and_expense/test_deferred_revenue_and_expense.py
+++ b/erpnext/accounts/report/deferred_revenue_and_expense/test_deferred_revenue_and_expense.py
@@ -279,3 +279,78 @@ class TestDeferredRevenueAndExpense(FrappeTestCase, AccountsTestMixin):
 			{"key": "aug_2021", "total": 0, "actual": 0},
 		]
 		self.assertEqual(report.period_total, expected)
+
+	@change_settings("Accounts Settings", {"book_deferred_entries_based_on": "Months"})
+	def test_zero_amount(self):
+		self.create_item("_Test Office Desk", 0, self.warehouse, self.company)
+		item = frappe.get_doc("Item", self.item)
+		item.enable_deferred_expense = 1
+		item.item_defaults[0].deferred_expense_account = self.deferred_expense_account
+		item.no_of_months_exp = 12
+		item.save()
+
+		pi = make_purchase_invoice(
+			item=self.item,
+			company=self.company,
+			supplier=self.supplier,
+			is_return=False,
+			update_stock=False,
+			posting_date=frappe.utils.datetime.date(2023, 12, 30),
+			parent_cost_center=self.cost_center,
+			cost_center=self.cost_center,
+			do_not_save=True,
+			rate=3910,
+			price_list_rate=3910,
+			warehouse=self.warehouse,
+			qty=1,
+		)
+		pi.set_posting_time = True
+		pi.items[0].enable_deferred_expense = 1
+		pi.items[0].service_start_date = "2023-12-30"
+		pi.items[0].service_end_date = "2024-12-30"
+		pi.items[0].deferred_expense_account = self.deferred_expense_account
+		pi.items[0].expense_account = self.expense_account
+		pi.save()
+		pi.submit()
+
+		pda = frappe.get_doc(
+			dict(
+				doctype="Process Deferred Accounting",
+				posting_date=nowdate(),
+				start_date="2024-01-01",
+				end_date="2024-01-31",
+				type="Expense",
+				company=self.company,
+			)
+		)
+		pda.insert()
+		pda.submit()
+
+		# execute report
+		fiscal_year = frappe.get_doc("Fiscal Year", get_fiscal_year(date="2024-01-31"))
+		self.filters = frappe._dict(
+			{
+				"company": self.company,
+				"filter_based_on": "Date Range",
+				"period_start_date": "2024-01-01",
+				"period_end_date": "2024-01-31",
+				"from_fiscal_year": fiscal_year.year,
+				"to_fiscal_year": fiscal_year.year,
+				"periodicity": "Monthly",
+				"type": "Expense",
+				"with_upcoming_postings": False,
+			}
+		)
+
+		report = Deferred_Revenue_and_Expense_Report(filters=self.filters)
+		report.run()
+
+		# fetch the invoice from deferred invoices list
+		inv = [d for d in report.deferred_invoices if d.name == pi.name]
+		# make sure the list isn't empty
+		self.assertTrue(inv)
+		# calculate the total deferred expense for the period
+		inv = inv[0].calculate_invoice_revenue_expense_for_period()
+		deferred_exp = sum([inv[idx].actual for idx in range(len(report.period_total))])
+		# make sure the total deferred expense is greater than 0
+		self.assertGreater(deferred_exp, 0)