Land of the Landed Costs

Land of the Landed Costs- Part 2

So, here I am with part two of the landed cost saga finally. Last time, we went through the process of setting up landed costs. In our example, we were setting up insurance costs so that the invoice from the insurance vendor could be matched back to the shipments received from the product vendor. But, before we get down the road that far, let's overview the three key ways that landed costs can be used.

Landed Costs by line item

• Specify a landed cost group on a line item when recieved (can default from the item setup, from the purchase order, or manually entered)
• Calculated amounts can be adjusted by line item on receipt

Landed Costs by apportionment

• Specify an individual landed cost for the entire receipt document
• Apportion the amount across the items on the receipt by qty, extended cost, or weight
• Landed cost must use flat amount cost method

Landed Costs by invoice match

• Landed cost group specified by line item on receipt (default from item setup, or from the purchase order, or manually entered)
• Does not have to calculate an estimate amount on receipt, but it can.
• Individual landed cost must be set up for Invoice Match, and for Revalue for Cost Variance if applicable
• Use Enter/Match Invoices to enter an invoice from the landed cost vendor, and match it to the shipment from the product vendor

So, let's take a look at each of these options. In Landed Costs by line item, we can specify a Landed Cost Group on the Purchase Order line item.

Transactions>>Purchasing>>Purchase Order Entry, click on a line item, and then click the expansion arrow to the right of the Item header.

Remember, this value defaults from the item/site combination in Cards>>Inventory>>Quantities/Sites. However, it can be changed here to provide a different default to the receipt.

So, when we get to Transactions>>Purchasing>>Receivings Transaction Entry, the landed cost group will appear on the line item once again. You can view it in the same way as you did on the purchase order, by clicking on the line item and then clicking on the Item header expansion arrow. However, you may find it more helpful to view the actual landed costs being calculated for the line item, based on the landed cost group assigned. This can be done by clicking on the line item, and then clicking on the expansion arrow to the right of the Unit Cost header.

You can override the amounts specified here. The percentage or amount fields will be available based on the calculation method you defined for the landed cost.

Also, on the receipt, we can do Landed Costs by Apportionment. To do this, we simply click on the Landed Costs button at the bottom of the Receivings Transaction Entry window to open the Receivings Landed Cost Apportionment window.

In this window, you can select Landed Costs to apportion across the entire receipt. You must select a landed cost that is setup with a flat amount calculation method in order to select quantity, value, or weight in the "apportion by" field.
The system calculates each method as follows:

• Quantity: (Line item's quantity shipped - the quantity rejected)/(Sum of all line items' quantity shipped- the quantity rejected)
• Value: [(Line item's quantity shipped -the quantity rejected)*Originating Unit Cost]/Sum of all line items [(quantity shipped -the quantity rejected)*Originating Unit Cost]
• Weight: (Line item's extended shipping weight)/(Sum of all line item's extended shipping weight)

In either case, Landed Cost by Apportionment or Landed Cost by Item, the distributions that result are the same:

• Debit to Inventory
• Credit to Accrued Purchases for Landed Cost (per Landed Cost Maintenance)

So, that leaves us with the last method of Landed Cost by Invoice Match. In this example, let's assume that we posted the estimated landed cost of 10% of extended for the INSCARRIER landed cost on the shipment receipt. Now, we have received an invoice from the actual insurance carrier, Associated Insurance, and find that the costs were actually much greater. Since we set up the INSCARRIER landed cost for invoice match, we can now record the invoice from Associated Insurance and match it back to the shipment from Advanced Office Systems.
To do this, we go to Transactions>>Purchasing>>Enter/Match Invoice and enter an invoice for Associated Insurance (NOT Advanced Office Systems):

There are just a few key differences in how you enter the landed cost invoice:

• Vendor ID is the landed cost vendor
• Mark the "LC" checkbox for the line item to identify it as a landed cost
• Select the landed cost to match for the item (rather than an actual item)
• Match the landed cost to the original shipment from the product vendor using the Matched to Shipment expansion button

The distributions that result depend on whether you have selected to Revalue Inventory for Cost Variance:

If you are revaluing:

• Debit to Inventory (if cost is greater than receipt)
• Debit to Accrued Purchases for Landed Cost
• Credit to Accounts Payable

If you are not revaluing:

• Debit to Purchase Price Variance for Landed Cost (if cost is greater than receipt)
• Debit to Accrued Purchases for Landed Cost
• Credit to Accounts Payable

So, I hope this helps clarify the different ways to approach landed cost in Dynamics GP. I find that some clients will use all three methods, but many also settle on one or two ways that work best for their goals. Please share your experiences, questions, etc.

Land of the Landed Costs

Land of the Landed Costs- Part 1

Landed cost is the total cost it takes to "land" an item on your doorstep, including additional charges like freight, customs, and processing. More and more, I find that companies are interested in landed cost as they increase the use of international suppliers and manufacturers. By using landed cost, the "total" cost of the item is reflected in inventory and is valued as an asset, rather than immediately expensing those additional costs. Take the following example, where I purchase a widget from my European supplier:

• Purchase 100 widgets @ $20/each
• Overseas shipping costs are $1500
• Customs, Duties, and other Processing Fees are $500
• Domestic shipping costs are $400

If I were to value my widgets only at the cost from my vendor, the cost in inventory would be $2000 for the 100 widgets at $20/each. And then I would expense the additional $2400 in costs.
The situation changes though, if I am using landed costs. Using the same costs above, I would value my inventory at $4400 dollars in total, or 100 widgets at $44/each. Perhaps a more accurate picture of the inventory value? In turn, this increased cost will affect my Cost of Goods Sold on the sales side, impacting my margin appropriately.
So, now that we have an example, how about talking through how Landed Costs work in Dynamics GP? With Landed Costs in Dynamics GP, these costs can be:

• Recorded as an estimate amount on a receipt
• Matched to an invoice and revalued to provide a more accurate amount

There are five key aspects to Landed Costs in Dynamcs GP from my perspective:

• Landed Cost Setup: Includes setup of individual landed costs, landed cost groups, and assignment to item/site combinations
• Purchase Order Landed Cost: Assigning landed cost groups to POs
• Receivings Landed Cost: Recording of landed cost groups on Receipts
• Receivings Landed Cost Apportionment: Apportionment of landed costs across an entire receipt
• Invoicing Landed Cost: Recording invoices for landed cost vendors and matching them back to the original product receipts

Let's take a look at each aspect. In this post, I will cover the setup items. And in my next post, I will cover the actual transaction entry. First, Landed Cost Setup.

Cards>>Inventory>>Landed Cost

This is where you can set up each individual landed cost that you plan to track. If you plan to match invoices for the landed cost, you will want to put in a Vendor ID. Matching invoices for landed cost means that (in this example above), I could record the actual insurance invoice from Associated Insurance and match it back to the shipments from my supplier for the product I purchased.
You can also select a cost calculation method, this will be how the landed cost estimate on the receipt will be calculated. If you have chosen to match invoices, the invoice amount will be compared against the original estimate on the receipt. The resulting difference can be revalued, if Revalue Inventory for Cost Variance is marked. Otherwise, the difference will post to the Purchase Price Variance account.
The GL account specified are used in the following manner:

• Accrued Purchase Account: Used as the offset to the landed cost estimate on receipts, and cleared when the amount is invoiced or matched to invoice.
• Purchase Price Variance Account: Used for the variance between invoice and receipt when matching invoices but not revaluing.

Note that no inventory or expense account is specified because the item's account will be used, since landed cost is updating the inventory cost/value of the item.

Cards>>Inventory>>Landed Cost Groups

Landed Cost Groups are used to organize landed costs in to sets that can be assigned to item/site combinations and/or to document line items like Purchase Orders and Receipts. An individual landed cost can exist in more than one landed cost group. You might choose to have landed cost groups to represent a set of landed costs for:

• A specific location
• Certain items
• A type of shipping process

In my example above, I have chose to set up a landed cost group for my domestic shipments. It includes both the insurance costs and the freight costs. Now, I can assign this landed cost as a default for certain combinations of items and sites.


Cards>>Inventory>>Quantities/Sites

This step is not required. However, if appropriate, you can assign a landed cost group to a specific item/site combination in this window. Doing this will cause the landed cost group to default on the purchase order line item, where it can be changed if necessary.

Dynamics GP 2010 R2 - New Features List

Inside Dynamics GP, The official Dynamics GP Blog has been posting the feature list since Mar 2011 for Dynamics GP 2010 R2. The list is very interesting and Some of them are very cool, check out all by the links below

Feature:

Set the Default Column Order In Smart List Builder

Feature:

Multi company Excel Reports in a single worksheet Using Excel Report Builder

Look & Feel:

Feature:

Excel Reports Bulk Deploy In Excel report Builder

Look & Feel:

Feature:

Business Portal Reports Center

Look & Feel:

Feature:

Additional SRS Reports for Payroll, Human Resources and Inventory 

Look & Feel:

Feature:

Rewrite Report Deployment Wizards

Look & Feel:

Feature:

Copy List Items in Extender

Look & Feel:

Feature:

Add Unified Communications Functionality in Extender

Look & Feel:

Feature:

Business Portal Migration Utility

Look & Feel:

 

Feature:

Microsoft Dynamics Security Synchronization Utility

Look & Feel:

Feature:

ELS Elimination of Modal Forms

Look & Feel:

Feature:

List View Performance Enhancements

Look & Feel:

Feature:

Business Portal External Lists

Look & Feel:

Feature:

Ability to Copy Email Messages

Look & Feel:

Feature:

Feature of the Day: Substitute Fields for Email

Look & Feel:

Feature:

Ability to Create Email Messages

Look & Feel:

Feature:

Feature of the Day: Ability to Email Reports

Look & Feel:

Feature:

Word Template Generator

Look & Feel:

Feature:

Script Editor Names Window

Feature:

SOP Return Word Templates

Look & Feel:

Feature:

Report Builder Integration (Export)

Look & Feel:

Feature:

Report Builder Integration

Look & Feel:

Feature:

New SQL Reporting Services Reports

Look & Feel:

Feature:

Drilldown from SQL Reporting Services Reports

Look & Feel:

Feature:

Business Intelligence Refresh

Microsoft Dynamics GP 2010 R2 gives people a Business Intelligence refresh of the SQL Reporting Services (SRS) reports.  Redesigning the reports gives a consistent look throughout all SRS reports and an updated  graphical interface.  The Reports have also been updated to pull in the Currency symbol and decimal places based on the Company Setup within Microsoft Dynamics GP. 

Look & Feel:

Feature:

Business Analyzer Desktop Application

This reporting application not only allows each user to access reports from their desktop, but also allows them to take actions on the reports and easily share information with others.  The application installs with default reports, however users easily make edits to the default reports or create their own personalized reports using SQL Server Reporting Services.

Look & Feel:

Note:  The desktop Business Analyzer application is licensed through a Light User.

Feature:

Business Analyzer Dynamics GP Client

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How to Generate Multiple Invoices Against a single Order/Quote in sale Module of Microsoft Dynamics GP 2013 E.g A order of 30 Carton comes and i have to fulfill this order in 3 installments (10 each) and i want 3 different invoices against the single order 


Answer 1:

1- Create an order with Qty 30

2- First Invoice

     i) Modify the Qty To Invoice field in detail window to 10

     ii) Transfer to invoice

     iii) Post

3- Second Invoice

     i) Modify the Qty To Invoice field in detail window to 10

     ii) Transfer to invoice

     iii) Post

4- Third Invoice

     i) Modify the Qty To Invoice field in detail window to 10

     ii) Transfer to invoice

     iii) Post   
Etc.

Answer # 2

Shipping one order over multiple invoices is an easy task with all releases of GP. All you need to do is: 
A) The 1st Shipment/Invoice 
1- Open the order 
2- change the QTY to Invoice to 10, QTY to B/O (Back Order) is 20 
3- from the main menu click ACTION, then Transfer to Invoice 
This will invoice only 10 Cartons while 20 will remain in B/O (Back Order) 

B) The 2nd Shipment/Invoice 
1- Open the order 
2- change the QTY to Invoice to 10, QTY to B/O (Back Order) is 10 
3- from the main menu click ACTION, then Transfer to Invoice 
This will invoice only 10 Cartons while 10 will remain in B/O (Back Order) 

C) The 3rd Shipment/Invoice 
1- Open the order 
2- change the QTY to Invoice to 10, QTY to B/O (Back Order) is 0 
3- from the main menu click ACTION, then Transfer to Invoice 
This will invoice only 10 Cartons and close the order (move to History).