A Creative Way to Allocate Revenue Using Charges in Microsoft Dynamics AX 2012
Posted on: October 10, 2016 | By: Jarrod Kraemer | Microsoft Dynamics AX/365
Authored by: Rosey McAdams
Let’s say that your company has a need to allocate a sales order line to two different revenue accounts, perhaps you would like to break down a line on a sales order to allocate to both a product revenue account and a service revenue account. One way to solve this issue would be to break up the sales order line into two separate lines with an item and a service item pointing at different posting profiles – one that hits the product revenue and one that hits the service revenue. In this scenario the customer can clearly see both lines on the sales order, but what if you do not want the customer to see both lines, what if you only want the customer to see one line for the product, but also allocate some of that revenue to a service revenue account internally? This can be done quite simply using charges in AX.
The benefit of using charges is that you can have the flexibility to manually allocate revenue across multiple accounts on an order by order basis for a varying amount, or you can setup automatic charges to automatically allocate a fixed amount or a certain percentage of the total line amount. In this blog we are going to look at an example of how to manually setup a charge on a sales order line to allocate some of the revenue associated with that line to a second revenue account.
First we want to sell a product that will hit a product revenue account when sold, so I have chosen the product below with the item group Consume. For this item group the revenue account that is setup is the Product Sales account 401100.
· Item 0016 with Item group Consume:
· Item group Consume revenue hits account 401100 – Product Sales:
Now that we have verified the revenue account setup for this item’s item group we will create a sales order line for the product with a unit price of $70.
Let’s say that for this sales order line we want $50 to go to the Product Sales account that is setup on the item, but also want to allocate $20 of that line to allocate to a service revenue account for some service that we provided upon shipping the item. To do this, first we need to navigate to Accounts Receivable>Setup>Charges>Charges Code to setup a new charge code for revenue allocations.
1) Click New, and setup a charges code called Allocate, and enter a description.
2) In the Debit posting section make sure to choose Ledger Account, Allocation, and choose the Product Sales account (401100 in our example) in the Account field.
3) In the Credit posting section make sure to also choose Ledger Account and Allocation. Now in the Account field choose the Service Revenue account that you would like to allocate some of your revenue to (401200 in our example).
Now that we have setup our charge code, we can now go and use the charge on our sales order to allocate the revenue. Navigate back to the sales order that we created, select the order line, and click on Maintain Charges.
Choose your Allocate charges code that we just created, and enter in a charges value of $20.00 to allocate $20 to the service revenue account.
Now when you invoice this sales order and look at the voucher you will see that $20 was moved out of the Product Sales account and into the Service revenue account.
Hopefully this blog helped walk you through how to easily use charges on a sales order line to allocate revenue. For additional information or help configuring charges please feel free to reach out to us at email@example.com or (312) 345-8817.
All the best!
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