This chapter contains these topics:
Section 16.1, "Objectives,"
Section 16.2, "About the Billing Process,"
Section 16.3, "About Billing for Contracts."
16.1 Objectives
To understand the Billing Workfile
To understand the origination of costs for time and material
To apply markups to costs for time and materials and related components
To create, print, and void invoices
To create and record accounting journal entries
16.2 About the Billing Process
The typical billing process includes accumulating costs, creating and printing invoices, and recording journal entries for income and receivables.
When you perform the billing process using the Contract Billing system, you can:
Accumulate billable costs from multiple systems, such as Accounts Payable, Equipment/Plant Management, and Payroll, without re-entering the cost information into the billing system
Calculate markup amounts and taxes based on a hierarchy of multiple user defined rules
Revise workfile transactions for T&M costs, including components
Calculate the billing amounts at the time you create invoices
Facilitate immediate billing upon entering the costs into the system
Print invoices to customer specifications
Automatically create and record the journal entries for the Accounts Receivable and General Accounting systems that result from billing
The billing process consists of the following tasks:
Accumulating costs
Reviewing the workfile
Revising the workfile
Working with the workfile history
Generating invoices automatically
Working with invoices
Creating invoices manually
Printing invoices
Working with A/R and G/L entries
Working with final invoices
16.3 About Billing for Contracts
When you set up a contract, you define billing lines for costs related to time and materials (T&M) and costs that are not related to time and materials (non-T&M).
| Topic | Description |
|---|---|
| T&M billing lines | The portion of a contract that you bill for the actual costs of goods and services plus specific markup amounts for the work. The actual costs include payroll-based costs, such as labor and burden, and non-payroll-based costs, such as the equipment and material required to complete the contract. |
| Non-T&M contract billing lines | The portion of the contract that is not related to time and material, such as fixed fees, prepayments, and quantities. You can define the following non-T&M contract billing lines:
Component billing lines directly relate to costs for time and materials. However, the system processes component billing lines similar to non-T&M billing lines. |
The tasks that you perform for billing depend on whether the billing lines that you set up for your contracts are for costs that are related to time and materials.
If your contracts include time and materials (T&M), you begin the billing process by accumulating costs. When you accumulate costs, the system creates workfile transactions. You can then use the workfile transactions to create invoices automatically.
If your contracts do not include T&M billing lines, you do not need to accumulate costs before initiating the billing process. Instead, you begin the billing process by creating invoices automatically. When you create invoices automatically, the system calculates billing amounts.
You can always create invoices manually, whether your contracts include costs for time and materials or not.
16.3.1 Before You Begin
Set the Journal Generation Control system constant to allow invoicing (billing)
Create the contract master records
Define contract billing lines
16.3.2 What You Should Know About
| Topic | Description |
|---|---|
| Alternate displays and system constants | Many of the forms you use in the Contract Billing system change in functionality and appearance, depending on the way you set up your system constants. For example, if you set your system constants for billing (invoicing) only, the forms and functionality apply only to the billing process. |
