6 Job Cost. Chapter JOBS LEARNING OBJECTIVES

Transcription

1 Chapter 6 Job Cost LEARNING OBJECTIVES 1. Restore data from Exercise 5-2. (This backup was made on page 188.) 2. Learn about Sage 50's Job Cost system. 3. Set up a job. 4. Coordinate job costs with purchases, sales, and payroll. 5. Display the Job Profitability Report. 6. Make two backups, save one Excel file, and save one PDF file. This chapter shows how to use the Job Cost system. In Sage 50, you can assign Job ID codes to purchases, sales, and employee hours. In this way, Sage 50 tracks how each of these factors impacts job costs. The diagram below illustrates how job costing works with purchases, sales, and payroll. Purchases Sales JOBS Hours Worked Sage 50 s job costing feature allows you to track the costs incurred while performing a job. To use job costing, identify the project for which you want to track expenses and income and then determine how much detail is needed. 191

2 192 Chapter 6 There are several advantages to using job costing: It allows you to track income and expenses for each project the company undertakes. You can create estimates for each job. As you enter invoices for materials or services used in the job through accounts payable, they can be assigned to a job so actual costs can be compared with job estimates. You can exercise greater control over costs and revenues by tracking customer invoices and payments received for each job. You can print reports during a job's progress to find out the total amount spent and net revenues due for each job. You can also maintain statistics on various jobs including starting date, completion date, and the progress of each job and view these by printing various job-costing reports. If phases or cost codes are used, you can generate reports to display this information, showing whether a job is over or under budget for any phase or task involved. This helps control costs by adjusting one phase or task prior to the job's completion. Job costing gives you greater insight into all the company s jobs or projects so that you know what you are spending, how long it is taking, and how much profit was made on each job. The diagram below shows how Sage 50 organizes job costing. 1) Setup 2) Tasks 3) Reporting

3 Job Cost 193 GETTING STARTED Bellwether Garden Supply has a customer named Franklin Botanical Gardens. Once a Job ID is set up for Franklin Botanical Gardens, you can track supplies and employee hours charged to this customer. 1. Start Sage 50. Open Bellwether Garden Supply - Student Name. (If Bellwether Garden Supply - Student Name is not shown, Create a new company using the restored data. Refer to the Read me box on page 29.) 2. If necessary, restore data from the Exercise 5-2 backup. (The Exercise 5-2.ptb backup was made on page 188.) Restoring overwrites or replaces an existing file. To make sure you are starting in the appropriate place in the data (Exercise 5-2.ptb backup) check the General Ledger Trial Balance. A partial trial balance is shown below. The General Ledger Trial Balance was completed in Exercise 5-2, step 1, page From the Navigation Bar, select > > New Job. The Maintain Jobs window appears. Read the Job ID information, and each field explanation as they appear.

4 194 Chapter 6 4. In the Job ID field > type FRANKLIN > press <Enter>. (Use uppercase.) 5. In the Description field > type Franklin Botanical Gardens > press <Enter> two times. 6. Type 3/4/17 in the Start Date field > press <Enter> to go to the For Customer field. (Hint: Or, click on the For Customer field). 7. In the For Customer field, select FRANKLIN. 8. Click on the Job Type field, select LAND. Compare your Maintain Jobs window to the one shown below. 9. Save this job. Close the Maintain Jobs window to return to the Customers & Sales Navigation Center. JOB COSTING AND PURCHASING: Purchasing Inventory Items for Jobs This new job has some special circumstances; namely, Franklin Botanical Gardens has a new building overlooking a park. In the park, there are several picnic tables. According to the terms of the contract with Franklin Botanical Gardens, Bellwether Garden Supply purchases and provides a special wood treatment to the picnic benches.

5 Job Cost 195 When inventory items are purchased for jobs, you need to do the following: Record the purchase directly as a job expense. You could indicate a Nonstock or a Description only Inventory Item but not a Stock Item. Record the purchase into Inventory. When you bill the customer, enter the Item and the Job. The system posts the price as Job revenue and the Cost of Goods Sold as Job Expense. Date Transaction Description 3/20/17 Invoice No. AD501 was received from Adler's Landscaping for the purchase of special wood treatment, $85; terms 2% 10, Net 30 Days. Apply this purchase to the Franklin Botanical Gardens job. 1. From the Navigation Bar, select > > New Bill. The Purchases/Receive Inventory window displays. 2. Type or select AD (Adler s Landscaping) for the Vendor ID. 3. Select or type 20 in the Invoice date field > press <Enter>. 4. Type AD501 for the Invoice No. (This is a required field.) Press <Enter>. 5. The Apply to Purchases tab is selected. Type 1 in the Quantity field > press <Enter> two times. 6. In the Description field, type Special wood treatment > press <Enter>. 7. Account No , Materials Cost, is the default account displayed in the GL Account field. Your cursor is in the Unit Price field. Type 85 > press <Enter> two times. 8. Type or select FRANKLIN, the new Job, in the Job field.

6 196 Chapter 6 If your GL Account field and A/P Account field are not displayed on the Purchases/Receive Inventory window, see the instructions on page 19, step 1c, Hide General Ledger Accounts area. 9. Click to post this purchase. Close the Purchases/Receive Inventory window to return to the Vendors & Purchases Navigation Center. JOB COSTING AND SALES Follow these steps to invoice Franklin Botanical Gardens for a drip irrigation system and apply this sale to Franklin Botanical Gardens, Job ID, FRANKLIN. Date Transaction Description 3/21/17 Bellwether Garden Supply sold one Bell-Gro Home Irrigation System, Item No. EQWT-15100, to Franklin Botanical Gardens on account, $129.99, plus $9.10 sales tax, total $139.09; terms 2% 10, Net 30 Days.

7 Job Cost Select > > New Sales Invoice. The Sales/Invoicing window displays. 2. In the Customer ID field, click > select Franklin Botanical Gardens as the Customer > press <Enter>. 3. Select or type 21 in the Invoice date field. 4. If necessary, click on the Apply to Sales tab. 5. Click on the Quantity field, type 1 > press <Enter>. 6. In the Item field, type EQWT (Drip Irrigation System). 7. Press <Enter> until you are in the Job field. (You are accepting all of the displayed information when you do this.) 8. Type or select FRANKLIN, the Job ID for Franklin Botanical Gardens. If your GL Account field and A/R Account field are not displayed on the Sales/Invoicing window, see the instructions on page 19, 1c, Hide General Ledger Accounts area.

8 198 Chapter 6 9. Click to post this invoice. Close the Sales/Invoicing window to return to the Customers & Sales Navigation Center. JOB COST AND PAYROLL In the example that follows, one employee applied the special wood treatment to the picnic tables at Franklin Botanical Gardens. The employee spent one hour applying the wood treatment. 1. From the Navigation Bar, select > > Enter Payroll for One Employee. The Payroll Entry window appears. 2. Click in the Employee ID field, select Alex C. Kornel > press <Enter>. 3. Type 29 as the Date > press <Enter> two times. 4. Type 29 in the Pay Period Ends field. 5. On the icon bar, select the Jobs icon. The Labor Distribution to Jobs window appears. 6. In the Job field, click on the down arrow >select FRANKLIN. Select FRANKLIN

9 Job Cost Press the <Enter> key. Type 1 in the Hours field > press <Enter>. In the Amount field, is shown. 8. Click. You are returned to the Payroll Entry window. 9. Click to post the paycheck. Close the Payroll Entry window to return to the Employees & Payroll window. JOB COST REPORTS Job cost reports tell you how jobs are progressing. Follow these steps to look at Job Cost Reports. 1. From the menu bar, select Reports & Forms > Jobs. The Select a Report or Form window displays. 2. In the Job Reports: Project Information list, double-click Job Profitability Report. The Job Profitability Report appears.

10 200 Chapter 6 3. Scroll down to FRANKLIN. The report breaks down each job according to what was spent or earned for each affected general ledger account. It also shows the profit or loss for each job. 4. Close all windows. BACKING UP CHAPTER 6 DATA After completing the work within Chapter 6, back up. The suggested file name is Chapter 6.ptb. Detailed steps for backing up data are shown on pages Backing up saves your data to that point in your work. Each time you back up, use a different file name; for example, the suggested file name at this point is Chapter 6.ptb. (Sage 50 automatically adds the file extension.ptb to backups.) Using a unique file name allows you to restore at different points in the data. ONLINE LEARNING CENTER Complete the following end-of-chapter activities online at > Student Edition > Chapter Interactive Multiple-Choice and True/False questions. 2. Going to the Net exercise: Access the Sage website. 3. QA Templates: 10 short-answer questions and one analysis question.

11 Job Cost Assessment Rubric: Review journals, navigation centers, modules, and task windows. 5. Listen to narrated PowerPoint slides. The OLC also includes links to the Appendixes: Appendix A: Troubleshooting (textbook and OLC) Appendix C: Review of Accounting Principles (OLC Student Edition) Appendix D: Glossary of Terms (OLC Student Edition) Exercise 6-1: Follow the instructions below to complete Exercise Start Sage 50. Open Bellwether Garden Supply - Student Name. 2. If necessary, restore data from the end of Chapter 6. This backup was made on page Journalize and post the following transactions: Date Transaction Description 03/26/17 Sold two Bell-Gro Impulse Sprinklers (EQWT-15160) to Franklin Botanical Gardens, $64.18 (includes sales tax); terms 2% 10, Net 30 Days; Job ID Franklin Botanical Gardens. 03/26/17 Invoice No. AD967 was received from Adler s Landscaping for the purchase of one container of special wood treatment for $85; terms 2% 10, Net 30 Days; Job ID Franklin Botanical Gardens. (Debit Materials Cost.) 03/29/17 Amanda W. Chester worked one hour on the Franklin Botanical Gardens job. Apply her paycheck to this job. (Hint: Remember to select the appropriate job and hour worked. Refer to pages , steps 6 and 7. The Job Profitability

12 202 Chapter 6 Report completed in Exercise 6-2 depends on selecting the appropriate job and entering the hour worked.) 4. Continue with Exercise 6-2. Exercise 6-2: Follow the instructions below to complete Exercise Print a Job Profitability Report. (Hint: If needed, select Adobe PDF or Microsoft XPS Document Writer as the printer. If you save as a PDF file, use the file name shown in step 4. Refer to page 66, How to Fix - I do not have a printer.) 2. Back up Exercise 6-2. Use Exercise 6-2 as the file name. Read Me: This backup is important. If you are using external media; for example, a USB drive, do not delete the Exercise 6-2.ptb file. You restore the Exercise 6-2.ptb backup file to complete work in Part 4, Chapters 16, 17, and Export the Job Profitability Report to Excel. Use Exercise 6-2_Job Profitability Report.xlsx as the file name. 4. Save the Job Profitability Repot as a PDF file. Use Exercise 6-2_Job Profitability Report.pdf as the file name. Check Your Figures: Job Profitability Report, FRANKLIN Actual Revenue, $ Actual Expenses, $ Profit dollars, -$91.88 Profit percentage,

13 Job Cost 203 CHAPTER 6 INDEX Backing up Chapter 6 data Exercise Exercise Getting started Job cost and payroll Job cost reports Job costing and purchasing: purchasing inventory items for jobs Job costing and sales Learning objectives Online learning center

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