Distributing Expenses over the Final Cost of the Product
In most cases, expenses arise from production and sales processes, such as shipping, manufacturing, importing, and so on. It’s essential to allocate these costs to the final product cost.
- Note: Before creating the purchase invoice you want to distribute expenses on, you should ensure the “Requisitions of Purchases & Sales” is enabled.
Distribution Steps
- Click on “Inventory” from the main menu.
- Click on the requisition that includes the purchase invoice you want to distribute the expenses on from the “Manage Requisitions” page.
- Click on “Distribute Expenses“.
- Enter the distributed expense information as follows:
- Type: Choose the nature of the distributed expense from among:
- Expense: You can select any of the expenses you have in the account.
- Journal: You can select any of the journal entries you have in the account.
- Expense: Select the expense or entry to be distributed on the products.
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- You can choose from the expenses you have in the account or add a new expense.
- Distribution Type: Choose the type of distribution from among:
- Manual: You manually allocate part of the expense to each product.
- Amount: The expense cost is automatically distributed based on the cost of each product.
- Quantity: The expense cost is automatically distributed based on the quantity of each product.
Note that once you add the expense details, its cost, and determine the distribution type, the table displays the product costs before and after distributing the expenses on them.