In everyday work, you post journal entries or marketing documents to a G/L account that is linked to a distribution rule. You can only link accounts with the account type Sales or Expenditure in the chart of accounts.ĭistribution rules define how the costs or revenues posted for an account are distributed to the cost centers. For example, if you want to show only 80% of your rental expenses as costs, you can assign the remaining 20% to Center_z.ġ/ Distribution Rules Link Between General Ledger and Cost Accountingįor costs submitted to the general ledger to be included in cost accounting, you should link an account to a distribution rule, in the Chart of Accounts. The Center_z cost center can also record costs that are not to be reported in internal cost accounting. The system automatically creates a center zero cost center ( Center z) that collects the costs and revenues that cannot be clearly distributed to other cost centers because not enough information is available. You can combine your cost centers into groups by using a sort code.Ĭhoose Financials -> Cost Accounting -> Cost Centers to define and maintain cost centers. In our example, OEC Computers defined their three departments: sales, support, and development as cost centers. You can then compile a profit and loss statement for each cost center in every period. To use the cost accounting functions in SAP Business One, you must define the profit centers or departments in the company as cost centers. The accountant of the company, asks you how could they know the bottom line for each department? How can they issue a Profit and Loss report for a department?.On the other hand they have a lot of expenses: travel, hotel, dinner, conferences, advertising, bonuses etc. Naturally, the sales department brings more revenue than the other departments.Assuming you are implementing SAP Business One in a company with three departments: sales, support, and development.
In this topic, we will look at the benefits of using cost accounting and describe how to manage it. Welcome to the Cost Accounting topic in SAP Business One.