Deferred profit for unit sales

Summary

This article explains how to enable deferred profit for unit sales. These settings are used in conjunction with Unit Purchase Order Processing.

More Information

When selling units, in advance of them actually being received into your stock, you may wish to defer the sale. This will enable you to incur the costs of the item in the same financial period as the sale is included on your Profit & Loss report.

This is a method that suits items which are invoiced well in advance e.g. Combine Harvesters and other large farm machinery.

If deferred profit is enabled the system will take into account whether a unit is already on a purchase order when it is invoiced.

• If it has not been received into stock an automatic journal will be posted to Debit the relevant Sales Nominal centre and Credit the Customer Prepayments Nominal centre.
• Any costs already incurred such as expenses are then posted to Credit the relevant Cost of Sales Nominal centre and Debit the Deferred Costs Nominal centre.

When the unit is received into stock the system will post additional journals to reverse the above postings to release both the sales and cost of sales to the Profit & Loss along with the cost of the unit.

Configuration

Go to " Reports & Settings Maintenance Options System Administrator Module Settings"

• Select " Unit Sales Module Settings"
• Scroll down the screen to "Deferred profit"
• Select "Record deferred profit" and click [Edit].
  • Select 'Yes' and click [OK].
• Select "Customer prepayments centre" and click [Edit].
  • Enter a suitable Balance Sheet centre in which the nett sale will be held until the unit is booked into stock.
  • You may press <Ctrl+F1> to search for a centre.
  • If you need to create a new centre, press [Add] from the search screen. The suggested settings are Balance Sheet - Current Liability but please check with your accountant.
• Click [OK] and [Accept].
• At "Customer prepayments centre modifiers" click [Edit].
  • These settings control whether the customer prepayments nominal centre should be modified to divert transactions to alternative nominal codes based on the transaction 'Site', 'account' being invoiced and whether the primary unit is a 'New/Used' unit. It is advised that only the 'Site' should be allowed to modify this specific code. This allows your system to hold a prepayment value per transaction site. If you are unsure of the settings to use please Contact your Platinum dealer or our support team on 0116 230 1500 or by using our website support contact page.
  • If you make any changes to this setting click [OK] else click [Cancel].
• Select "Deferred costs centre" and click [Edit].
  • Enter a suitable Balance Sheet centre in which the nett costs will be held until the unit is booked into stock.
  • You may press <Ctrl+F1> to search for a centre.
  • ** If you need to create a new centre, press [Add] from the search screen. The suggested settings are Balance Sheet - Current Asset but please check with your accountant.
• Click [OK] and [Accept].
• At "Deferred cost centre modifiers" click [Edit].
  • These settings control whether the deferred costs nominal centre should be modified to divert transactions to alternative nominal codes based on the transaction 'Site', and whether the unit is a 'New/Used' unit. It is advised that only the 'Site' should be allowed to modify this specific code. This allows your system to hold a deferred cost value per transaction site. If you are unsure of the settings to use please Contact your Platinum dealer or our support team on 0116 230 1500 or by using our website support contact page.
  • If you make any changes to this setting click [OK] else click [Cancel].
• Click [Done] and [Accept] to save the deferred profit settings.

See also

• How do I configure unit purchase order processing?
• Nominal integration
• How do I create a unit purchase order?
• How do I process a unit purchase order?
• Selling a unit
• Unit order reports

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Keywords AND Misspellings

unit order, vehicle order, purchase, grn, status, factory order, sales order, deferred, on order, automatic cost of sales

Tags

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