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ReportProject type is Fixed Price. Accounting Method is Cost to Cost.
Does anyone understand the GL postings tht this type of project creates?
For example, set up a project ith some cost categories. Enter some purchase invoices to create actual costs on the project. Then run the first revenue recognition process.
Why does GP post the Revenue Recognised to WIP? I know I can detail what the GL accounts for each posting should be...but I cannot affect the GL Journal make up. The Distribution Types are fixed. (there is a type in here called PROJBILL...is this the same distribution type as PRGJ BLG...which appears in the Billing Journal???)
For me, the journal created by a revenue recognition should be:
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CR WIP with the actual cost
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DR COGS with the actual cost
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CR Income with the revenue recognised
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DR Income in excess of billings
So why does GP do it the way it does? Whats the accounting reason?
WIP should just take distributions for Costs. When the cost is incurred...it Debits WIP...when the cost is recognised (ie during income recognition), WIP is credited and COGS is debited. No other distributions should be hitting WIP.
Any advice or discussions would be appreciated.
Ian.
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