Invalid Scenario #1

• Incurred Cost of Sales Method
• UNITS Function Code (on the Manage Account Groups screen) to record unit usage
• Cost of Sales Account, Warranty Accrual Account and Warranty Expense Account Transaction Type on the Set Up Sales Group Abbreviations screen to record COGS and warranty expense accrual

Unit Usage Posting

General Ledger:

Open Billing Detail:

Unit usage records as well as COGS and warranty expense accruals are posted to the Open Billing Detail table. This setup is improper because you bill the customer for both the unit cost and the unit usage (price times quantity).

Invalid Scenario #2

• Incurred Cost of Sales Method
• NON-LABOR Function Code (on the Manage Account Groups screen) to record unit usage
• Cost of Sales Account, Warranty Accrual Account and Warranty Expense Account Transaction Type on the Set Up Sales Group Abbreviations screen to record COGS and warranty expense accrual

Unit Usage Posting

General Ledger:

Open Billing Detail:

No records update the Open Billing Detail table, because you cannot bill unit usage using a NON-LABOR Function Code, and you are recording unit COGS and unit warranty expense using a UNITS Function Code.

Invalid Scenario #3

• Billed Cost of Sales Method
• NON-LABOR Function Code (on the Manage Account Groups screen) to record unit usage
• Cost of Sales Account, Warranty Accrual Account and Warranty Expense Account Transaction Type on the Set Up Sales Group Abbreviations screen to record COGS and warranty expense accrual

Unit Usage Posting

General Ledger:

No impact until the bill is posted.

Open Billing Detail:

No records are posted to the Open Billing Detail table, because the usage does not contain a UNITS Function Code and the COGS and warranty expense accrual uses a UNITS Function Code. In addition, because the Billed Cost of Sales method is being used, the unit COGS is not billed or posted.

Bill Posting