We have service technicians that setup equipment before the equipment
is sold and delivered to our customer. We need to allocate the
technicians time to COGS (it is currently a Salary and Wage expense).
We currently allocate the technicians time by creating a GL journal
entry that moves their allocated time from the technician's expense
account and moves it to the equipment's COGS account. This is working
We don't like giving access to create journal entries to our
inside staff, so I am looking for another way to do this. I have tried
creating an Item of Item Type "Services" that will default the Inventory
account to the technician's expense account and the COGS account to the
equipment COGS account (this should CREDIT the expense account and
DEBIT the COGS account). However, when I create a sales invoice (at
$0.00 to our internal customer account), it has no cost to pull for the
service technician (even though we have a standard and current cost
internal rate of $65.00/hr setup on the item card).
How could we move the time spent from
expense to COGS without allowing our inside staff to make a journal
The cost from a Service Item does not affect COGS unfortunately. How about this - on your internal customer card, set the default Sales Account to credit your technician expense account and the Default AR account to debit the COGS account. Use the price fields on the sales transaction to enter the cost.
This will post invoice amounts to your AR Trial Balance. At the end of each period, do one big credit memo to the internal customer and apply it to the outstanding invoices. So that this doesn't inflate the sales value on your 'trade customer' trial balance, set the internal customer up in a separate class and exclude that class when running your trial balance report.
Just a thought . . .
Frank E. Hamelly, MCP, MCITP, MCT, MVP
I am going to have to think about this one. This might actually work for us. Thanks for the insight.
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