Create Charges code in Ax 2012 5


In the real-time business scenarios there may be some additional expenses (over & above the goods value) incurred on the purchase or sales transactions; these expenses can be freight, loading & unloading charges, insurance etc.

There are 2 scenarios

  1. To add the expenses to the total purchase order or vendor invoice
  2. To load the value of the expenses to the goods to determine the cost of goods or cost of good sold.

In order to maintain & record the additional expenses during a purchase or sales transaction in Ax we use charge codes. The use of charge codes is available for purchase & sales both and has a similar way of setup.                             

In Ax this can be achieved with the help of Maintain charges functionality.

1. Setting up Charges for Purchase.

    1. Accounts Payables –> Setup –> Charges –> Charges code
    2. Define a new Charge code
    3. Define Purchase Tax code (if charges are taxable)
    4. Define the Debit & Credit posting at the Posting tab to determine the charges will be posted:
    • In case the charges are to be added to the total purchase order or the invoice:
      • Debit field group:
        • Type field: Select option Ledger account
        • Account field: Select the relevant ledger account for charges.
      • Credit field group:
        • Type field: Select option Customer/Vendor

The above setup will ensure that the expenses are debited to the correct expense account & added to the Vendor’s account while invoicing.

    •  In case the charges are to be added to the value of the goods:
      • Debit field group:
        • Type field: Select option Item
      • Credit field group:
        • Type field: Select option Customer/Vendor

The above setup will ensure that the expenses are debited to the product account & added to the value of the goods while invoicing.

 

2. Setting up Charges for Sales.

    1. Accounts Receivable –> Setup –> Charges –> Charges code
    2. Define a new Charge code
    3. Define Sales Tax code (if charges are taxable)
    4. Define the Debit & Credit posting at the Posting tab to determine the charges will be posted:
    • In case the charges are to be added to the total sales order or the invoice:
      • Debit field group:
        • Type field: Select option Customer/Vendor
      • Credit field group:
        • Type field: Select option Ledger account
        • Account field: Select the relevant ledger account for charges.

The above setup will ensure that the expenses are credited to the correct expense account & added to the Customer’s account while invoicing.

Happy Learning!


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5 thoughts on “Create Charges code in Ax 2012

  • Syamalan

    Setting up Charges for Purchase.
    In Credit field group:When I am choosing from Type field: Select option Customer/Vendor an error coming “Postings to vendor account cannot be made..” Please give me a solution for the charges are to be added to the value of the goods.

  • Syamalan

    My setup in xxx /Accounts payable/Area page > Charges code
    Charge code: LC
    Description: Landed Cost
    Item sales tax group: (Blank)
    Maximum amount: 0.00
    Posting
    Debit
    Type: Item
    Posting : Purchase charges, freight
    Account: 62106 (Freight charges)
    Credit
    Type: (Here I cant select Customer/Vendor as you mentioned)

  • Admin Post author

    Try with the setup as;
    Debit Posting Type – Item
    Credit Posting Type – Customer/Vendor

    You can select ledger account against posting type Ledger only and not Item or Customer/vendor.

    The difference is:
    Item (Dr.), Customer/vendor (Cr.) combination is used
    To add the unit charge to the item cost.

    Ledger (Dr.), Customer/Vendor (Cr.) combination is used
    To record the charge as an expense as part of the total for the purchase order or vendor invoice.