Database Training – Nashville/2006 Advanced Accounting

Database Training – Nashville/2006

Advanced

Accounting

Adv. Accounting, Kathleen GrawNashville, April 2006

Who am I?

Johnstone Supply Santa Ana/Laguna Hills Ten Years

Database User Ten Years

Undergrad B.A. Texas Tech University

Grad School MBA w/Acctg Specialty Cal State University

Database ConsultantThree Years

Conference InstructorFour Years

KathleenGraw


Ground Rules

ASKQuestions

Come & GoAs you Please

Keep ?’s Relevant

To all

NO ? Is stupid

Do NotRun with Scissors

No Name Calling

Simple RulesSimple Rules

Do Not Run withScissors


Ground Rules Cont’d

MY WAYIsn’t

The ONLY Way


Topics

Quick Tips & Tricks 1

Accounts Payable2

Average Cost & Balancing Inventory3

Warranty4

General Ledger5


Topics

Aging 6

End of Year Close7

Miscellaneous Accounting Functions8


First Topic

11Quick Tips & Tricks – Ways to make your job easier!


4.1.9

13.5

19.7b

Favorite Menu Paths


ft

Create a folder on C drive” pick

Enter “ft” at any printer select prompt

Will be called “ft.txt” in C:\\pick

Text file or convert to Excel format

File Transfer


If users available – multiple ports

Turn on Scroll Bar

Accuterm Settings


Second Topic

22Accounts Payable –

Making paying your vendors easier!


Menu 13.20


Menu 13.20.8


Reoccurring Vouchers

Enter vouchers in 13.20.8

Listing 13.20.9 (Monthly)

Update 13.20.10 (Monthly)


Steps to Voucher Merchandise

Batch created in 13.20.2 or 13.20.3

Sequential Voucher Register 13.20.5

Handcheck Register (if applicable)In 13.20.6 / 13.20.27

Merchandise Vouchered

Merchandise Vouchered


Menu 13.20.3


Menu 13.20.3


.

Inventory Valuation13.20.3

1

2

3Drawbacks

Only works on DC invoices

No Corp Discrepancies

13.20.2 versus 13.20.3


Menu 13.20.2


Menu 13.20.2


Menu 13.20.2


Questions?


Third Topic

33Average Cost & Balancing Inventory –

Accounting for your biggest asset.


Menu 13.20.2


Average Cost Impact

BUT


Average Cost Impact

122*22.97 + (120*24.417 - 120*22.952) = 2802.34 + (2930.04-2754.24) = 2978.14/122 = 24.410 for average cost

122*24.410 + (120*24.417 - 120*22.952) = 2978.02 + (2930.04-2754.24) = 3153.82/122 = 25.850122*25.85 + (120*23.69 - 120*22.952) = 3153.70 + (2842.80-2754.24) = 3242.26/122 = 26.578


Inventory Valuation

$$

Quantity on Hand

Purchase Price Variance (PPV)

Average Cost


Average Cost


Calculation

Step OneStep One Step TwoStep Two End ResultEnd Result

QOH x Average

Cost

New Average

Cost

Diff. on Inv v. PO


QOH = 300 jugs

Average Cost = $60.00ea

PO = 200 @ $65.00ea

Vendor Invoice = 200 @ $70.00ea

Average Cost Example


QOH x Average Cost (500 * $60) $30,000.00

PLUS

Difference on Invoice vs. PO (200*$70) – (200*65) $1000.00

_________________________

QOH (500)



$62.00

New Average Cost



Balance Sheet & Income StatementBalance Sheet & Income Statement

Inventory Valuation Impact

• Overstate Inventory $

• Overstate Profits

• Overpay Commissions

• Understate Inventory $

• Understate Profits

• Underpay Commissions

WidespreadImpact


Average Cost Impact

Inventory Value

@ $60 = $30,000

@ $62 = $31,000

Understated by$1,000

Sell 500 @ $80:

@ $60 = $10,000

@ $62 = $9,000

Overstated by$1000

Net Income

Commissions @ 3% of GP:

@ $60 = $300

@ $62 = $270

Overpaid by $30

Commissions

500 jugs


Average Cost Impact

Inventory Value

Devalued your Company by understating

your inventory.

Paying taxes on income that you

didn’t really realize.

Net Income

Paid out more to sales people than

you needed to and inaccurately

reduced your bottom line & affected cash

flow.

Commissions

Bad Avg. Cost


Accurate reflection of Gross Profit by month

Accurate reflection of Gross Profit by part

Accurate reflection of Net Income

No large inventory adjustments at year end

Better handle on inventory value and turns

Average Cost reflects true cost

Average Cost Impact


Inventory Valuation


Detail

Summary

Detail vs. Summary


Impact General Ledger (Detail)? YES NOStock Adjustments XReceive in Inventory XVoucher/Accounts Payable XMonth End Journal Entries X

Detail

General Ledger Implications


Impact General Ledger (Summary)? YES NOStock Adjustments XReceive in Inventory XVoucher/Accounts Payable XMonth End Journal Entries X

Summary

General Ledger Implications


Voucher Widget for $100 / Billed $100

Inventory Accounts Payable

100.00 100.00

Detail

Summary

Average Cost Impact


Voucher Widget for $100 / Bill for $125 / No QOH


100.00 125.00Summary

PPV

25.00

Detail

Average Cost Impact


Voucher Widget for $100 / Bill for $125 / QOH


125.00 125.00Summary

Average Cost of product is updated

Detail

Average Cost Impact


EOM Inventory Procedures


Use Menu 13.20.2 and 13.20.3

Run Menu 13.20.7 at month end and use for reversing Journal Entry

Inventory XXXXX Inv. Accr XXXXX

Inventory Journal Entry #1


Multi Stores: EOM Account for inventory transfers S01/S02/S03



J/E for Store #1

Debit Inventory 02 $20960.79 Credit Inventory 01 $20960.79


Scenario One



Scenario Two

J/E for Store #1

Debit Inventory 02 $20960.79 Credit Intercompany 01 $20960.79Debit Intercompany 02 $20960.79 Credit Intercompany 02 $20960.79


Stock Adjustments




Reopening Receivers

If you do it – have to reopen the first & only receiver on the PO

OR

It throws out your AP/GL Reconciliation

Reopening Purchase Orders


Reopening Purchase Orders


Physical Inventory

Be sure to make note of the final variance amount that you update since you will need to make the journal entry on the books to balance the detail to the summary.

You debit/credit inventory and an income statement account with this variance amount.


Other Issues to Consider

Warranty’s Impact

Store Returns

Buyback

Dropships

Non-Inventory Items (Z95 items)


Monthly Reconciling

EOM Journal Entries

Average Cost

Pieces to Valuing Inventory

Time & Effort


Documentation

•Inventory Reconciliation

• Buyback

Handout – Reconciling Inventory Detail & Summary

Handout – Buyback Processes & Procedures


Documentation

•Dropships

Handout – Dropships


Questions?


Fourth Topic

44Warranty –

What goes on behind the scenes


Warranty Accounts


1 Credit Memo (m1.2) 10 12 12 10

2 Warranty Update (ME) 10 10

3 Create Claim (m15.3) 10 10

CREDIT REC'D

4 Post Credit-Claim (m15.10) 15 15

5 Voucher Credit (m13.20.1) 25 25

RECEVING

4 Replacement (m15.11) 10 10

Inven Sales A/R COGS Warr Pend Warr A/R Warr Discrep A/P

WidgetAvg. cost = $10Sale Price = $12Credit from Vendor = $25

Warranty & the General Ledger


Warranty Reconciling

EOM Balancing

•Unclaimed Warranties•Claimed Warranties – AR

•Inventory?



Warranty AR

Warranty Clearing




Documentation

•Warranty

Handout – Warranty


Questions?


Fifth Topic

55General Ledger – Reporting the money you made


Menu 14


12.4.3

14.1.1 (for each company)

Add to financial statements

Setting up a GL account


Menu 12.4.3


Menu 14.1.1


Setting up Financial Statements


Journal Entries

1. Enter JE 14.1.3 or 14.1.4

2. Print & Review JE 14.1.13 & 14.1.14

3. Update Trial Balance 14.2.4


Menu 14.1


Menu 14.1.3


Menu 14.2


Menu 14.3


Menu 14.5


Sixth Topic

66Aging –

Ways to look at the money customers owe you


Menu 35.6, Screen #2


Option #1 by Month

End


Option #1 by Month

End


Option #1 by Month

End


Option #1 by Month

End


Option #2 by Due

Date


Option #2 by Due

Date


Option #2 by Due

Date


Option #2 by Due

Date


Option #3 by

Invoice Date


Option #3 by

Invoice Date


Option #3 by

Invoice Date


Option #3 by

Invoice Date


Seventh Topic

77End of Year –

Putting one year behind you and starting another one.


End of Year procedures

1.AR Month-end close rolls into Year End*Confirm with DST

2.Close 12th month AP

3.Close year AP*MUST happen before entries for new year

4.Close 12th month GL*Manually Rollover NI

5.Close year GL *NO 13th month


Documentation

•EOY Procedures

Handout – EOY Close


Eighth Topic

88Miscellaneous –

Things you may/may not know…


Service Charges Menu 4.3


System Purge Parameters Menu 28.0


System Purge Parameters Menu 28.0


System Purge Parameters Menu 28


Menu 11

Reporting Variances

Different Sales files capture different things*Customer detail file

Variances*Freight*Misc Charges*Branch Sales*Returns


Product/GL Control

Only works with Product CLASS in Product MASTER


Product/GL Control

Menu 12.3.3


Accounting Upgrades

•Documentation

Handout – Accounting Upgrades 2006.1


Upgrade Suggestions


Session Evaluations

Database Training – Nashville/2006

Documents

Database Training – Nashville/2006 Advanced Accounting