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Hi,
We have a Maintenance Contract with a Client, Operation Dept. bills the client based on the COMPLETED Work Orders , Our accounting Period (Closing) is ONE Month , Some work orders take more than 1 month
My Question is What the most proper Project Type we should use ?
Regards
Mustafa
Hi Mustafa,
The billing is not driving the project type to be used, but how you want to do the project accounting. You choose a project type based on fixed-price or time & material. The required cost accounting part would drive more the project type to use.
With fixed-price, you can setup the on-account schedules. With T&M you can also use the billing rules. You can find proper documentation here: Project invoicing - Finance | Dynamics 365 | Microsoft Docs
As Andre already clarified billing to customer will not decide what project type you have to use in business, We usually prefer Time and Material projects for larger projects when a scope isn't firmly defined and it also provide flexibility of billing timing.
Fixed Price projects has a tightly defined or locked scope, If some how scope of the project changed then we create a change order to accommodate an additional scope.
Apart from that there are other many factors to select an appropriate project type.
In your case if your maintenance contract has defined and agreed scope and billing to customer at 100% WO completion then i suggest to go for Fixed Price. Nevertheless you still have total control on project group level > Ledger section ((if you want to book Man Power cost, Material, Expenses to WIP account or expense out)
Hi MUSTAFA,
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