Cost and Profit Centers

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The cost and profit centers allow you to catalog the transactions according to different criteria than normal accounts.
Cost centers are usually used to categorize expenses to specific activities, which may or may not have a correlation between them.

  • Projects, Events, Building sites
  • Customers and suppliers, Partners, Merchants
  • Additional detail for certain expenses (e.g. ancillary expenses)

Cost centers are assigned to the transaction row and can be used simultaneously to the Segments.

Characteristics of Cost centers

  • The Cost and Profit centers (CC) are accounts, preceded by the ".", "," and ";" signs
  • There are three levels of cost centers:
    • CC1 preceded by a period "."
    • CC2 preceded by a comma ","
    • CC3 preceded by a semicolon ";"
  • Each level is independent of the other.
  • For each level, there can be an unlimited number of cost and profit centers.
  • A superior level can be used without using an inferior one.
  • Cost center codes can be alphabetic or numeric.
  • Cost centers can have their own grouping, different to that of normal accounts. For the same level of cost centers, subgroups can be created. Be careful not to mix cost center groups with other groups of a different level or with normal accounts or segments.
  • Each cost and profit center has its own account card, complete with transactions and balances.
  • A transaction on the cost center is independent of the account recorded in debit or credit.
    One can even record on a cost center without any account in the debit and credit column.

Setting up cost centers in the Accounts table

Cost center accounts are set up in the Accounts table, with the exception of the Cash Manager which only uses setting up in the Categories table.

For setting up:

  • Create a specific section for the cost centers.
    This setup will be necessary for the presentation of the cost centers in the Enhanced Balance Sheet with groups.
    • Enter a section with an asterisk * for a section change.
    • In the next row, enter 03 and 04 for a profit center and the related description.
  • Add rows for the cost center
    • In the Group column, enter the group to which the cost center account is assigned
    • In the Account column, enter the cost center account preceded by a full stop "." for those to be registered in CC1 column (Transactions table), a comma "," for those to be registered in CC2 column and a semicolon ";" for the ones to be registered in the CC3 column.
    • In the Gr column, indicate the group into which the amounts are to be totaled.
    • In a Multi-currency accounting, the account currency is also specified.
  • Add the cost center groups
    • In one and the same group, total only for one specific level.
    • As for normal accounts, different levels can be created.

set up cost center

File Properties (VAT amount)

In the File and accounting properties command, in the VAT tab you can set the amount of cost centers with the following options:

  • Use transaction amount - The amount of the cost center is registered according the transaction amount
  • Use amount excluding VAT - The amount of the cost center is registered net of VAT.
  • Use amount including VAT - The amount of the cost center is registered including VAT.

Transactions

In order to register on the cost centers, it is assumed that the cost center accounts have already been entered into the Chart of Accounts.

To proceed with the recordings, you need to be in the Transactions table, in the Cost centers view; in the CC1, CC2, CC3 columns, you need to enter the cost center account without the punctuation that precedes it.

  • To record on the cost center in credit, the cost center needs to be entered preceded by the minus sign (-).
  • For the Income & Expense accounting, you can define for the cost centers to follow the sign of the category in the File and accounting properties.
  • In order to record a global amount on more than one cost center of the same level, a different row needs to be created for each different cost center.

cost center transcactions

If you wish to display the Cost Center description in the Transactions table, you need to activate the corresponding column (CC1Des., CC2Des. or CC3Des.) via the Data → Columns setup command.

Cost center account card

The cost center is treated as any other account, so each cost center has its own account card with account balance and account transactions.

Unlike all other accounts, the cost center account does not have a contra account. If you want to view the contra account we recommend using the Segments.
In order to view all cost center account cards, click on the menu Reports →  Account/Category cards → Cost centers (Filter option).

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