Short version of my question:
How do I enter charges during the sales cycle, where the charges are to be covered by me and not my buyer.
When selling an item, I see that there is an option to include additional charges under “Taxes and Charges”. But I have some charges that will not be paid by the buyer. For example, shipping charges, payment to logistics company for shipping, etc. I want to account for them somehow, so that my Profit & Loss calculation is correct. But I can’t charge my customer for this. How do I do this?
On the purchase side, I had a similar question as to how I can account for some expenses that the supplier won’t pay. I still wanted to include them so that stock valuation is calculated correctly. I found out that the answer was to use “Taxes and Charges” in the Purchase Order and then set “Consider charges or tax for” as “Valuation”. This worked beautifully. I expected something like this on the sales side as well.
What am I missing?
Side question: How do I reopen a closed forum topic? I would like to update one of my previous discussions with a newer/better answer (Deducting fees in a purchase order) in case it is useful for others.
For the purchase side there is an option called Landed Cost Voucher, which you can create everytime you make a purchase invoice or a purchase receipt. I hope this solves your problem on the purchase side of things.
For the sales side, I think you should create an expense account with the title sales expenses and add these details to that.
I’ll try to see if there is anyother way we can do it.
Thanks for your response.
I think I am good with the purchase side. You are right that Landed Cost Voucher can be used. Or, if the expense is known ahead of time, we can enter it in the Purchase Order itself, or Purchase Receipt/Purchase Invoice under “Taxes and Charges”, as I had mentioned earlier.
My open question is with the sales side. How exactly do I use an expense account as you mentioned? Are you suggesting just doing an expense journal entry or is there a way to tie an expense to a sales order? If I charge Rs. 1000 to a customer and it costs me Rs. 100 for shipping and if the shipping expense is mine (customer doesn’t pay), where do I enter the Rs. 100? Is there a way to enter it in the sales order itself, or some other way to tie up this expense with this sales?
I think you could add your additional expense as a time sheet(if you want to charge a customer for it i.e.) or pass a journal entry if you don’t want to charge the customer or may be provide discount on it the customer.
I could add a journal entry, but that wouldn’t tie back to the sales order though.
I noticed that there is an old question in this forum that asks the same question - Handle shipping cost
I’m trying to solve this problem too.
Anyone got any solution to this ?
I am having this problem too right now, any solutions yet?
Client wants their e-comm weekly sales to be encoded in ERPNext.
Ex: For week 1
Total sales = PHP 13000
Total Expenses = PHP 800
Payout = PHP 12200
Sales - Expenses = Payout
Sales are the amount paid by the customers for the item(s). No expenses deducted to the buyers.
Expenses: Logistics, Marketing Fees, and Admin Fees are costs to be deducted from the Seller.
- This cannot be done through Journal Entry due to it will result to unbalanced entries.
- Payout has to be recorded along too.