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Managing Cost for Misc Charge Inventory Type - Subcontractor Item

  • 1.  Managing Cost for Misc Charge Inventory Type - Subcontractor Item

    Posted 12 days ago

    We have an issue where our company uses subcontractors for projects and we have an inventory item called Subcontractor.  It is non-inventory type Misc Charges and the cost is not reflected properly on the invoice to the customer.  This skews cost and commissions.

    The cost, by design, that gets pulled when receiving updates the Current Cost which fluctuates wildly with many projects going on.  For example the Subcontractor cost on the PO may be $5,000 and the cost on the SO pulls $10,000 because the last receipt came in on a larger project PO with a larger cost (Current Cost).

    Other than serializing the item I am looking for a solution as that is not viable since we used Subcontractor frequently over many branches.

    Any ideas would be appreciated.



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    Greg Ristow
    Senior ERP Administrator
    McGann and Associates
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  • 2.  RE: Managing Cost for Misc Charge Inventory Type - Subcontractor Item

    TOP CONTRIBUTOR
    Posted 12 days ago
    Hi @Greg Ristow

    When you say "Project" are you referring to GP's Project Module?

    Other than that, if you have a limited number of Subcontractors you can setup an item with that specific contractor in mind OR if your process allows for it you can link SOP and POP... OR, you can edit the cost of an item in SOP ​before you post the invoice so that it is more accurate to determine the profit on a sale:




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  • 3.  RE: Managing Cost for Misc Charge Inventory Type - Subcontractor Item

    Posted 12 days ago
    Hi Jo,

    Thanks for posting.  I did try to change the cost on the invoice but get a message stating it is not allowed.  We use the Subcontractor item frequently for different jobs that are not apples to apples.  We do have the project module and these are used on SOP and POP.

    So if we link the subcontractor SO's to the PO's the cost from the PO will carry through to the SO?


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    Greg Ristow
    Senior ERP Administrator
    McGann and Associates
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  • 4.  RE: Managing Cost for Misc Charge Inventory Type - Subcontractor Item

    Posted 12 days ago
    I didn't mention we are on FIFO Perpetual GP 2016R2.

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    Greg Ristow
    Senior ERP Administrator
    McGann and Associates
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  • 5.  RE: Managing Cost for Misc Charge Inventory Type - Subcontractor Item

    GPUG ALL STAR
    Posted 12 days ago
    Hi Greg,

    Have you considered using Lot Tracked Items. This is a little less intense than individual "Serial Numbers"...but you could make the Lot Number = the Subcontractor Name/Project ID (or whatever would fit in the Lot Number field). This would require that you create an inventoried item for this. MISC CHARGE items do not allow any "Tracking" options (like Lot or Serial Tracking). If you do this, I would recommend setting up a separate Item Class and using a different Inventory and COGS account from any real materials that are bought and sold.

    If you want to change the PO window to stop defaulting to the last cost for the item, this can be done with PSTL (the free Professional Services Tools Library):

    PSTL - PO Cost Defaulter




    I did a little testing and reviewed the Help info on the SOP window. You cannot ever edit the cost on Sales Invoices...it is just more of an "FYI...this is the current cost". The real cost is captured when you post. (This is the same as showing Cost in negative Inventory Adjustments). Here is what "Help" says under "Unit Cost". Basically, it is only editable on Returns...if you have enabled that.

    Unit Cost

    Displays the unit cost of an item if you chose to display unit costs in the Sales Order Processing Setup window. If you haven't marked the Display Item Unit Cost option, the unit cost will be zero. If you're entering a non-inventoried item, enter the cost of the item.

    If the invoice quantity is a negative, you can change the unit cost. If the invoice quantity is a negative, you can change the unit cost even if the Display Item Unit Cost option is marked.

    The unit cost will be calculated according to the valuation method assigned to the selected item. The current cost will be displayed for items using FIFO, LIFO, and average perpetual valuation methods, and the standard cost will be displayed for items using FIFO periodic and LIFO periodic valuation methods.

    If you're entering a return and you marked the Override Item Cost for Returns option in the Sales Return Setup window, you can change the unit cost (or current cost) of the item. This allows you to define the cost when returning the item to inventory. If the Override Item Cost for Returns option hasn't been selected, the current cost of the line item will be displayed and can't be changed.


    Let me know if any of this helps...or if it just makes it more confusing...(if so...sorry!)

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    Amber Bell
    Training Dynamo LLC
    Email: amber@trainingdynamo.com
    Website: www.trainingdynamo.com
    Twitter: @trainingdynamo
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  • 6.  RE: Managing Cost for Misc Charge Inventory Type - Subcontractor Item

    Posted 9 days ago
    Thanks all for your input on this, much appreciated.

     

    Greg Ristow

    Senior ERP Administrator

     

    Amano McGann Inc.

    2699 Patton Road

    Roseville, MN 55113

    Tel | 651.308.3240

    greg.ristow@amanomcgann.com







  • 7.  RE: Managing Cost for Misc Charge Inventory Type - Subcontractor Item

    TOP CONTRIBUTOR
    Posted 11 days ago
    Hey @Greg Ristow

    Normally to use the POP SOP Link you must enter the SOP First, which is why I mentioned that if your process fits you could use that one.​

    If you want to try it, I'll copy in a link for you.

    How many SubContractors do you have on these "projects"?   If not many, then the absolute easiest thing to do is an item for each contractor since the cost is so varied.

    Or, since these are part of projects you could think about using GP's Project Accounting Module which has distinct capabilities for invoicing what hits a project at it's exact cost.

    Here is the link on POP and SOP:

    https://support.microsoft.com/en-us/help/917729/how-to-add-sales-order-processing-information-to-the-pop-purchase-orde

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