Item: Accounting Tab

Use the Accounting tab to assign accounts to an item. For items of the Fixed asset type, you can also define depreciation parameters under this tab. 

When you create new records in the Item directory, accounts under the Accounting tab are auto-completed being retrieved from the My company settings.  But, it is recommended to revise default accounts and change them to accounts that are more appropriate for a specific item. Accounts specified under this tab will be used in documents and all item-related transactions.

The tab pertains to all item types. However, accounts under the tab are item type-dependent. There are the following account groups:

Item

Accounts that belong to this group are used to record item details that are required for item management after obtaining an item and in the course of its storage or usage.    

Account

Used to

Inventory account

An account for recording purchased or manufactured merchandise and other inventory items that are kept in stock, as well as purchased or manufactured fixed assets that have not been recognized as fixed assets yet.

For items of the Inventory type, you select an inventory account from the list of pre-set accounts of the Inventory type. For items of the Fixed asset type, you select an inventory account from the list of pre-set accounts of the Fixed asset type.

The account is relevant for inventory items and fixed assets. The inventory account is debited with the item cost, this transaction being recorded as two journal entries - one entry is made to the Transaction journal, and the other to the Inventory journal. Based on data recorded in the Inventory journal, you can generate inventory reports that enable you to track the decrease or increase in your inventory, monitor changes in inventory value, check the availability of specific items in your warehouses or warehouse sections, control reservations, deliveries and sales to customers as well as orders, shipments and purchases from vendors.

  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.

Non-inventory expenses account

An account for recording expenses incurred due to the purchase of non-inventory items.

The account pertains to items of the Non-inventory type. 

  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.

Services expenses account

An account for recording expenses incurred due to the purchase of services.

The account is relevant for items of the Service type. 

  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.
 
Sales & COGS
 
Accounts under this group are used to record sales transactions and pertain to almost all item types. 
 

Account

Used to

Sales income account

An account used to record a business’s income from the sale of an item.  You select an income account from a list of pre-set Income accounts. 

  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.

Cost of sales

An account for recording the cost of goods sold that is calculated according to the selected inventory valuation method. Select an account from a list of COGS and Expense accounts.

The account pertains to items of the Inventory and Fixed asset types. 

  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.
 
 Fixed Assets
 
The group includes accounts and fields that are used to record and store information required for the recognition of fixed assets and determination of their depreciation parameters.  
 

Account / Field

Used to

Fixed assets group

Attribute a fixed asset to one of the pre-set fixed assets groups. Under the fixed assets group, the accounts for fixed assets, useful life and methods of depreciation accrual are defined. So, when you select a fixed asset group, fields and accounts pertaining to the fixed assets are auto-completed. Still, you can modify this data and manually enter other details.  

Method of depreciation

Select a depreciation method from the list of supported methods.

  • After selecting a fixed assets group for an item, depreciation method will be chosen automatically. Right now, only the straight line depreciation is supported by Codejig ERP. When other methods are implemented, you will be able to change the autocompleted method and choose an alternative one.
  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.

Useful life (months)

Number of months over which a fixed asset's cost is depreciated.

  • After selecting a fixed assets group for an item, depreciation period will be suggested automatically. However, you can change it.

Fixed assets - costs account

An account for recording the cost of fixed assets after they have been recognized as fixed assets by the Recognition document and depreciation parameters have been defined for them in the same document.  

The account is debited with the cost of fixed assets, and the respective transaction is recorded in the Transaction journal and the Fixed assets journal. Information recorded in the Fixed assets journal is processed by the fixed assets reports that allow you to analyze the decrease or increase of the initial and book values of fixed assets, calculate accumulated depreciation for each fixed asset and determine their residual life (remaining useful life).  

  • After selecting a fixed assets group for an item, the Fixed assets - costs account will be chosen automatically. However, you can change it.
  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.

Fixed assets - depreciation account

An account for recording the amount of an asset’s cost that has been depreciated over a specified period of depreciation.  The Fixed assets - depreciation account is credited with the depreciation amount. It is a credit account that is a contra account to the Depreciation expenses account.

  • After selecting a fixed assets group for an item, the Fixed assets - depreciation account will be chosen automatically. However, you can change it.
  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.

Depreciation expenses account 

An account for recording depreciation expenses. The Depreciation expenses account is debited with the depreciation amount. It is a debit account that is a contra account to the Fixed assets - depreciation account.

  • After selecting a fixed assets group for an item, the Depreciation expenses account will be chosen automatically. However, you can change it. 
  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.
 
Inventory adjustment  
 
Accounts under this group are used for recording an income and an expense recognized during the inventory adjustment process if lack of inventory or excess inventory has been detected. They are also used for accounting for personal use of inventory.
 

Account / Field

Used to

Inventory adjustment income account

An account for recording an income incurred due to the detection of excess inventory. 

  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.

Inventory adjustment expenses account

An account for recording an expense incurred due to the detection of lack of inventory or for accounting for inventory converted to personal use. 

  • It is a required field. If you delete this autocompleted account and do not select an alternative account of the same type, you will not be able to save the document.


More information
My Company Settings: Accounting Tab
Chart of Accounts