It is important to consider first whether distribution of Income is necessarily a function of the GL or used to evaluate performance as a function of management. In the latter case, Control is very flexible in its ability to retrieve, manipulate, and present data generated in the system regardless of the GL. You may wish to consider reporting options in lieu of detailed distribution of Income to the GL. If GL distribution is a requirement, the following applies.

Income posted to the GL is accomplished as an automatic function in control based on the GL Account assignment for each product/line item (Phase). Each product requires a default income/Income account assignment that can be changed or overridden during the order process. The design of the software is such that only one automatic assignment or distribution of Income to the GL can occur. Where the distribution of Income requires posting to multiple accounts, a manual redistribution is required by means of journal entry.

In practice the most efficient setup would have all line items requiring redistribution post Income to a single holding/temporary account, i.e. “Undistributed Income” (choose a name that makes sense to you) When the order is marked a sale the system will post an entry for each line item to the “Undistributed Income” account for the total Income value, less taxes.

GL Account Debit Credit
Accounts Receivable1000.00
Undistributed Income 1000.00

A journal entry would be created to redistribute the Income to the appropriate account returning “Undistributed Income” to a zero balance.

GL Account Debit Credit
Undistributed Income1000.00
Service - Labor Income 500.00
Service - Material Income 500.00

A custom report may be required to generate the appropriate values for distribution based on your setup of how markup is calculated. In Control the selling price is determined by the estimated cost times a markup. Markups can be established at a number of levels in control. At the most basic level, and the standard setup, each part/cost is assigned a value to calculate the markup. Additionally each part is assigned a type which allows for a common grouping. Part types are; Material, Labor, Equipment, Outsource, Freight, and Other. In the above example, the report would use the sum total of all labor parts times their markup for the first value and the sum total of all other part types times their markup for the second.
Where distribution to multiple accounts is not required, Income can automatically post to the appropriate GL Account without redistribution. This may be accomplished by setting the default Income/Income account for a line item or overriding the default during the order process.

GL Account Debit Credit
Accounts Receivable1000.00
Freight Income 1000.00

From Accounts Payable

Costs as they relate to the GL require the creation of usage cards that accomplish posted to the GL. Any time a “Bill” is created in the system a GL account assignment is required, and a usage card is automatically created to distribute the cost. If the line is for an inventory item, the posting would be to the appropriate inventory asset account. Non inventory cost of goods sold would post to WIP, costs not related to WIP would post directly to a GL expense account. Costs in WIP are automatically transferred to the assigned expense account when the order is marked a sale. Transfer of Inventory cost requires either posting additional usage cards to a line item (phase) where job costing is employed and or periodic adjustment of inventory by journal entry. (Inventory may be tracked off balance sheet in which case material cost would be expensed when incurred.)

From WIP

The ability to assign expense for each line item(phase) will be available in the next interim release of Control currently scheduled for mid to late February. A number of options will exist with this setup. Each part requires a default expense account assignment. The user can choose to post expense based on that assignment. In the case where the expense is relevant to how or where it is used, it will be more appropriate to select an assignment by “Part Type” for each line Item. These assignments will determine how “usage cards” handle the cost.

Usage cards / labor

The most common method for posting labor cost to a specific order or line item is to create usage cards in batch from time cards. It is recommended that all employees clock 100% of their time in this scenario. Employees would clock on and off of the station and line item where they are working. For labor not related to an order, they would clock onto a station that would typically post to a general expense account. At a regular interval, daily/weekly, time cards would be verified and an automated process run to create the appropriate cards. In this fashion the system will maintain the correct WIP accounts prior to final posting of expense.

Usage cards / Inventory

A usage card would be entered each time materials are pulled from inventory for a line item. Again, WIP accounts are maintained by the system until the order is marked Sale.

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