Getting Accounting stuff right

I'm not an accountant and need to make sure I'm doing things right. (start up business, can't justify accountant costs)

When adding a new product
What is the difference between Default Expense Account and Default cost center? And then Default Income account and Cost Center? 

When creating an invoice, What is Income Account? What does cost center must be specified for the Income Account mean?

Once I move into Journal Voucher, I'll post a few more questions. 


Hi,

Please check response below.

On Thu, Jan 17, 2013 at 5:22 AM, electromania <ia…@gmail.com> wrote:
I'm not an accountant and need to make sure I'm doing things right. (start up business, can't justify accountant costs).

When adding a new product
What is the difference between Default Expense Account and Default cost center?
The Expense Account and Cost Center selected in Item master will fetch automatically when select in Purchase Invoice. The purpose of these fields in Item master is to let user define default value.
And then Default Income account and Cost Center?
Same way, you can define default value for Income Account and Cost Center which will be fetched when selected item in Sales Invoice.

When creating an invoice, What is Income Account?
It simply means as your are making sales, you need to book the amount under Income Account.
What does cost center must be specified for the Income Account mean?

Cost Center is required when you select ledger from Profit and Loss statement. As Income and Expense account belongs to Profit and Loss Statement, you need to select a Cost Center with it.

Once I move into Journal Voucher, I'll post a few more questions.





--
Thanks and Regards,
Umair Sayyed
um...@erpnext.com
www.erpnext.com
Hi,

I would recommend going through the ERPNext manual. http://erpnext.com/manual

It has not been updated recently, but it should be able to answer most of your initial questions.

Thanks,
Anand.

On 17-Jan-2013, at 10:58 AM, Umair Sayyed <um...@iwebnotes.com> wrote:

Hi,

Please check response below.

On Thu, Jan 17, 2013 at 5:22 AM, electromania <ia...@gmail.com> wrote:
I'm not an accountant and need to make sure I'm doing things right. (start up business, can't justify accountant costs).

When adding a new product
What is the difference between Default Expense Account and Default cost center?
 
The Expense Account and Cost Center selected in Item master will fetch automatically when select in Purchase Invoice. The purpose of these fields in Item master is to let user define default value.
 
And then Default Income account and Cost Center? 
 
Same way, you can define default value for Income Account and Cost Center which will be fetched when selected item in Sales Invoice.

When creating an invoice, What is Income Account?
 
It simply means as your are making sales, you need to book the amount under Income Account.
 
What does cost center must be specified for the Income Account mean?

Cost Center is required when you select ledger from Profit and Loss statement. As Income and Expense account belongs to Profit and Loss Statement, you need to select a Cost Center with it.

Once I move into Journal Voucher, I'll post a few more questions. 





--
Thanks and Regards,
Umair Sayyed
um...@erpnext.com
www.erpnext.com