Ledger Accounts Questions And Answers Pdf

[Taj Barnett]

Weare looking to start using the Project module to track some contract R&D projects we do for customers (both fixed price and time & materials) and some internal investment projects. This is a small portion of our main business, which is manufacturing, so will only be used for a relatively small number of projects per year. I've looked through the TechNet set up guides and various blogs online, but nowhere can I find any kind of a guide to what General Ledger accounts the various types of Project Groups need to have configured. I've found bits and pieces for various project types, but no high level overview or examples that cover all the group types. Can anyone recommend a good set up guide or offer some tips? I've got Murray Fife's book, but it's heavy on showing the steps involved, but essentially nothing on WHY you're doing it and what the implications are.

For 1) You are right that fee transactions are used for billable amounts without associated costs. However, at the time the fee journal is posted, there is no ledger voucher generated because this voucher is generated at the time you post the invoice. The only thing that a fee journal does is recording a transaction that can in a second step be invoiced.

For 2) You can use the pending vendor invoice form also for service transactions. This requires that you make use of a procurement category that is linked to a project category. I know that this is a hurdle for some accountants who are used to enter account numbers but you can overcome this fear for example by including the account number into the project category name.

You can of course, continue using journals for recording invoices but be aware that you might see those costs late at a project, which is not an issue as long as you have fast invoice throughput times. Yet, I experienced a situation where an invoice >1 mio requires a long time to get approved. Because the company also used journals and not the pending vendor invoice form, the saw the costs late - too late - at the project level. So, just keep this issue with the committed project costs in mind if you want to use journals.

You use this setup for longer running projects where you need a periodic match between costs and revenues. What happens here is that all costs are posted to a P&L account. At the same time, a revenue accrual is created based on the expected sales price. At the time an invoice is created, the revenue accrual is reversed and replaced with the actual invoice revenue account setup in the project posting profiles.

I have not seen this often in practice. What happens with this setup is that all costs are 'stored' in a WIP account in the balance sheet until you invoice the customer. At the time the invoice is created, the WIP postings are reversed and shifted to the project cost accounts. At the end of the day, you can compare costs and revenues at the time an invoice is created.

For 1) My very limited understanding of the fee journal was that it was for recording billable amounts, without associated costs, which were outside the contracted sales amount. For example, if you needed to bill the customer a late fee on an earlier invoice. I'm very surprised there's no ledger transaction created to record the unbilled revenue when the fee journal is posted. That makes the purpose of that journal even less clear. Yes, I did mean expense journal when I said Time & Materials. That one also is confusing, because the TechNet documentation makes it seem like you can only use it to record for the project expenses which are shared with the Travel & Expense module.

For 2) The pending vendor invoice form seems to require that a purchase order has already be raised to a vendor. While most of our vendor transactions have PO's associated with them, not all do - especially for services. For most services, we find using the Invoice Journal in the AP module to be the most efficient vouching method. I had thought a project could still be referenced for lines entered there?

For 3) That's the problem and also the source of my confusion - there are multiple project types and also project groups which combine to determine if accrual postings are required or not, or if it needs to post directly to revenue and cost of sales accounts. There's just no documentation to be found online to help determine which combinations are appropriate for our project types and, from there, what general ledger accounts we do not currently have are required to be created.

For 1) I do not know a time & material journal but expect that you mean the expense journal, which can be used for recording vendor invoices. Fee journals do not create a ledger voucher. There are just there to create positions that can be invoiced later on. Fees can be used for a lot of purposes, you can for example invoice one-time fees or even replicate 'milestones' on a T&M project

For 2) To be quite frank, I do not like using journals for recording project expenses. Neither the AP invoice journals, nor the project expense journals. One of the reasons, why I do not like journals is because they are not included in the committed cost calculation (please see here for details: dynamicsax-fico.com/.../a-note-on-committed-project-costs). Another reason, why I do not like journals is because they do not allow recording project related intercompany postings. Finally, please remember that intercompany project transactions automatically create a pending vendor invoice. Using Journals would thus require working with different ways how ordinary and intercompany invoices are processed. My favorite is therefore the pending vendor invoice form for recording project expenses.

For 3) That is difficult to answer because there are so many setup options available. Do you refer to T&M Projects, Investment Projects, fix Price Projects? If you can provide some additional Information then I can try posting the created ledger vouchers incl. the posting types here.

There is not much around that describes this ledger setup. So you are more or less doomed to test different setups yourself. I am currently working on the second part of the following book (www.createspace.com/6725618), which will include all the information you are looking for. Unfortunately, I won't be able to finish this second part within the next weeks and can only try to help through this forum for the meantime. If you provide some additional information on what exactly you are looking for, we can try to get hopefully all of your questions answered here.

A Ledger records transactions from the journal and forms separate accounts for them in chronological order. A Ledger is a date-wise record of all the transactions related to a particular account. Ledgers are crucial sources of financial records. A ledger is formed after the journal and is the secondary step of bookkeeping. After the preparation of the journal, there comes the classification of journal entries into separate accounts and posting them in the ledger like a cash account, salary account, payable accounts, etc., in chronological order.

1. The debit and credit columns of every ledger account are compared when all the journal entries are posted in the ledger accounts. The difference between the total of debit and credit side is ascertained. The difference is to be placed in the amount column of the side having a lesser total.

3. If the total on the debit side of an account is higher, the balancing figure is the debit balance, and if the credit side of an account has a higher total, the balancing figure is the credit balance. If the two sides are equal, that account will show nil balance.

The Accounting Services Department is responsible for the University's financial reporting, oversight of journal entries, grant and contract awarded funds, general ledger account and cost center creation, and reconciliation of university bank accounts. We also provide several areas of SAP financial systems training.

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Basic accounting exam questions generally cover three main areas: Accounting Concepts, Statements, and Analysis. The very foundation of accounting is dealing with changing data elements and their sources. You will have to prove proficiency in recording, classifying, and presenting financial information and compiling it all into statements, which are further analyzed for meaningful insights. Let's see some examples.

The correct answer is A.

Every organization keeps an additional set of subsidiary ledgers by the name of Debtors (Subsidiary) Ledger and Creditors (Subsidiary) Ledger. These ledgers contain separate accounts for each individual debtor and creditor, respectively. A General Ledger only contains summary accounts for all the debtors and creditors by the name of Debtors Control Account and Creditors Control Account, respectively. Additional details are provided in the Subsidiary Ledgers.

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Ledger posting questions assess your ability to process and interpret information within a general ledger, record and categorize financial transactions accurately, and ensure that debits and credits are correctly applied.

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