Example: I might have 4 "lots" of manufacturing production overseas. You do the same thing for the WIP account reconcile to 0 once you know you offset a WIP balance to COGS (or inventory). You make two versions of this report: one is titled All Activity and one is filtered on Cleared = No and titled Current Balances. You clear only the transactions for the name(s) that is at 0. You only and always use an Ending Balance of 0. When you see names at 0, you reconcile that account. You also need to manage the Customer Liability by Name, making a custom report total by name. You can do this with a Bill for a vendor name = WIP, if you also want to list the Product/Services that went into WIP.Īnd this gives you the Gross Sales minus the COGS = the profit event. Then, WIP is evaluated for determining Costs, as COGS. The Sale is the Gross Revenue event = Income happens here. Use Customer Name and Vendor Name related transactions for everything.Īnd this is not quite right, either: "ONce each job is finished, we want to declare the income by journal entries out of the WIP into the income statement." This allows you to see everything as related to Customer Name, not as brute force manual accounting using Journal Entries. Use it later on a credit memo to apply to the invoice for actual charges. Make a Service Item for Customer Prepayment, link it to Liability, and use it on a Sales Receipt. " and customer receipts to a liability account in the GL."Īgain, use Products/Services. This way, for example, those construction people can list Windows/Doors, Electrical, Flooring, Appliances All of which can be used on Estimate, Purchase orders, Bills, Checks, credit card charge entries, and all of which allow you to manage Quantity and all of which end up in WIP. Law firm = Advanced Costs = WIP Other Current Assetįlipper or Builder of spec project = Construction in Progress = CIP Other Current Asset " What we would like to do is post expenses to asset accounts in the GL"īy using Product/Services, and not Multiple asset accounts. You asked about WIP not Earned Revenue, but Accumulated Costs = Work In Progress.
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