Hi, today I am going to discuss the accrual accounting in Microsoft Dynamics AX 2012 Project module using the time and material project.

Here I am going to show you the necessary configuration required to accrue the revenue at the time of hour journal posting. Consider the following scenario:

A project resource has been outsourced at the rate of 75 USD/hour against 50 USD/hour cost. Suppose, the project manager wants to post the 1 hour utilization for this resource and wants to accrue the revenue at the time of hour journal posting.

Follow these steps to configure the time and material project configured to accrue the revenue:

  1. Make sure that in the project group, under journalizing Profit and Loss has been selected under the hour transaction with Accrue revenue – hour checked as shown below:

You have to repeat the same step for all other types of transactions to accrue.

2.  The line property you are going to select for the transaction, must have the accrue revenue checked under WIP posting as shown below:

 

3. Finally, setup the ledger posting accounts: Accrued revenue – sales value and WIP – sales value accounts as shown below:

 

This completes the setup for the revenue accrual for the hour transaction in a time and material project.

Following is going to be the posted voucher:

Posting type Debit Credit
Project cost 50 (A)
Payroll allocation 50 (A)
Accrued revenue – sales value 75 (B)
WIP – sales value 75(B)

Accrued revenue gets reversed (transaction B) at the time of project invoice posting.

 

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