Landed Costs Overall Business Processes PURCHASING Related Business Process PURCHASING Responsible Department ACCOUNTING Involved Departments ACCOUNTING Last Updated 19/06/2009 Copyright 2009 Supernova Consulting Ltd. All rights reserved. This content may not be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or any information storage or retrieval system, without written permission. Requests for permission should be directed to info@supernova-consulting.com, +357-25-817880, or mailed to Supernova Consulting Ltd, P.O. Box 56747, 3309, Limassol, Cyprus Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 1 of 13
CONTENTS LANDED COSTS... 3 INTRODUCTION... 3 PROCESS FLOW... 3 PROCEDURES... 4 PROCEDURE: CREATE GOODS RECEIPT PO... 4 PROCEDURE: CREATE A LANDED COST BASED ON GOODS RECEIPT PO... 6 PROCEDURE: POST SUPPLIER S AP INVOICE... 11 PROCEDURE: CREATE CUSTOMS AGENT S AP INVOICE... 13 Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 2 of 13
Landed Costs Introduction The Landed Costs function allows companies that import goods to calculate the purchase prices of imported items including: Customs Transport and insurance fees Taxes Other landed costs This way companies that import items from overseas can calculate the cost prices of the imported items by allocating customs, transport and insurance fees, taxes, and other landed costs on the original price of the imported items and as a result, archive item cost accuracy. Process Flow The documents involved in the import process are in the Purchasing - A/P module and include: the purchase order (optional), the goods receipt PO, the A/P invoice (one for Supplier and one for border) and the landed costs. Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 3 of 13
Procedures Procedure: Create Goods Receipt PO 1. From the Main Menu, choose Purchasing A/P Goods Receipt PO. The following screen appears: 2. Select an existing Business Partner by entering the Business Partner code in the Supplier field or by typing the Business Partner name in the name field. 3. In Item/Service Type, select one of the following options: Item to create a goods receipt document for items defined in the Inventory module. Service to create a document for a service that has not been defined as an Item in SAP Business One. Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 4 of 13
In this case we will proceed with item type option as shown in the figure below: 4. Once you have posted Goods Receipt PO using the VCR buttons navigate backwards and click on the 3 rd tab (Accounting) then click on the orange arrow next to the Journal Remark to view the details of the journal entry created by the system. The following window opens: Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 5 of 13
5. The GR/IR Account is credited and it will be debited again later after the AP Invoice is posted (Service Type) in order to balance it. More information is provided below (Page 13) 6. The Supplier s invoice number must be entered manually in the Ref2 field (shown in the image above) for future report purposes. Procedure: Create a Landed Cost Based on Goods Receipt PO 1. From the Main Menu, choose Purchasing A/P Landed Cost. 2. Select Supplier using the code or the name field. 3. After selecting proper supplier, the button Goods Receipt PO (bottom-right corner) will become active. Click on the button. 4. The List of Goods Receipt window will open showing all the open goods receipts in the system for the selected supplier as shown below: Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 6 of 13
5. By default the first line is always highlighted. 6. Select the good receipt and click choose. 7. The document will automatically transfer to the Landed Cost screen. 8. Change the document currency to EUR 9. The Broker in this case is used only for reference. 10. Click on the Cost tab to enter all the additional expenses regarding specific Goods Receipt. 11. Note: there are many factors that can be used for cost allocation as shown below. Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 7 of 13
12. The amount 3000 which is miscellaneous expenses in this example will be then divided by the quantity total of all the items in Goods Receipt selected. ([Additional expenses=3000 and Quantity Total=154] => Fixed Cost = 19.48). The value 19.48 will then be allocated on each item based on its factors. 13. The item cost will change after the journal entry posting. 14. Click on an orange arrow of an item and navigate to the Stock Data tab 15. Note the item cost. (in this example: item 139587 has cost 77.2 and item 139600 has cost 191,3) Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 8 of 13
16. Click Add to post the Landed Cost. (Note: a journal entry will not be created with that posting). 17. Navigate backward to find the previous landed cost. 18. Click on the Journal tab and then click Create Journal Entry. 19. In this case, the system is using the Stock Account by default for the debit side; the user must manually select the FR/IR for the credit side. The amount that the FR/IR is credited is the amount equal to the additional expenses. Note: If any of the items were sold before the above transaction, the system will credit the price difference account with the equivalent amount. Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 9 of 13
20. After posting the journal entry navigate back to the item master data and open the stock data tab. Note that the item cost has already changed from 77.13 to 80.49. Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 10 of 13
Procedure: Post Supplier s AP Invoice 1. From the Main Menu, choose Purchasing A/P A/P Invoice. 2. Type the Business Partner code in the Supplier field or the Business Partner name in the name field. 3. Fill out all required information such us posting date, due and document date. 4. In the Item/Service Type field select Service. 5. Type the Account GR/IR (Goods Received Invoice Received) and enter the amount as shown on Supplier s invoice. 6. Click Add to save the document. Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 11 of 13
7. In case you want to close the Goods Receipt PO, navigate back to the Purchasing AP module and find the Goods Receipt PO. 8. From the file menu bar click Data Close. 9. Three messages will pop up as shown below. 10. Click Continue 11. Choose Current system date and then OK. Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 12 of 13
12. The following message will pop up. 13. Click Yes and the document will close. Procedure: Create Customs Agent s AP Invoice 1. From the Main Menu, choose Purchasing A/P A/P Invoice. 2. Select a Business Partner (Customs Agent). 3. Select the account for Freight Received - Invoice Received 4. Enter the proper amount for taxes. 5. Click Add to save the document. Copyright 2009 Supernova Consulting Ltd. All rights reserved. Page 13 of 13