Gen. Posting Setup - Direct Cost Applied Account

johnnyc313

Hi,

I was wondering if anyone could tell me what the Direct Cost Applied Acount is for? I'm not from an accounts background and I am relatively new to Navision. I can understand when most of the accounts are used, put not this one.

Thanks in advance..

Johnnyc

HalMdy

Direct Cost is "Labor" cost , in my mind ... :-k

Shenpen

If you purchase something, you usually post:

Debit: Inventory, Credit: Vendor in the long run. (And then you pay the Vendor.)

But, as you does not have to use Automatic Cost Posting, you can separate inventory posting and then:

upon receiving goods:

Debit: Purchase Account, Credit: Vendor

upon receiving the invoice, and running Adjust Cost - Item Entries + Post Inventory Cost to GL:

Debit: Inventory Account, Credit: Vendor

Of course in every sensible accounting you set up Purchase Account the same as Direct Cost Applies account, because they should usualy be ZERO, but some strange chart of accounts like Cronus do it a different way, I don't know why.