virtual training workbook - shoptech the e2 shop system

Virtual Training Workbook

Accounting

Professional Edition

Shop

SystemTM

www.shoptech.com

1

Objectives

This session will cover the following:

Company Maintenance Settings

Overview of tables directly affecting accounting

Accounts Receivable / Accounts Payable

General Ledger Functionality

Month End/Year End Process

Implementing E2 Accounting

Company Maintenance Settings

System | Company Maintenance | Defaults

General Ledger Tab Fiscal Year Begin Date

System will open up periods for 2 years’ worth of accounting from this date forward

Automatically updates after posting a fiscal year

Red letter fields required to enter accounting records in the system

Define divisions in order to print Income Statement by divisional breakdown

Customer Tab Designate how accounting information will be passed on the A/R invoices

Work Codes are attached to customers. Relates to type of service customer provides

Product Codes are attached to inventory items. Relates to parts made and sold

Both work codes and product codes require same information. Carry sales GL account

Accounting Related Tables

GL Group Codes (Base Table) Each GL code is assigned to a group of accounts

Each group code will subtotal on financial reports

Classification determines what financial report associated GL code appears on

Balance Sheet – Assets, Liabilities, Owners Equity

Income Statement – Sales, Expense, Other Income

GL Accounts (Core Table) Company’s chart of accounts

Each GL account must be assigned to a group code

Accumulation account allows for printing of consolidated balance sheet and income statement

Enter beginning balances under This Year tab

Credit values are represented by a minus sign

Monthly totals are system generated as each month is posted to the general ledger

Monthly values represent net activity for the month

Enter prior year’s balances under Last Year tab

Used for comparative financial reports

Will auto populate once the fiscal year is posted

Budget tab used for budget analysis reports

Values can be entered manually or by using the budget creation calculator

2

Exercise #1: Create GL Account

Tables | GL Codes | New

General Tab

GL Code = 6235

Description = Rent – Storage

GL Group Code = 70 Selling & Administrative

Budget Tab

Budget Creation Utility

Option = Total Per Month

Monthly Amount = 500

Click OK

Click OK to save & close

Bank Codes (Core Table) Create bank codes for each account that will need to be reconciled at the end of the month

System creates check register which makes it possible to view balances in Executive Overview of QuickView

GL Code needs to be unique for each bank code for reconciliation purposes

Check numbers cannot overlap between bank codes

Work Codes / Product Codes (Base Tables) Work Codes are attached to customers

Refers to type of work customers provide

Can be used as filter for customers, orders, invoices and related reports

Product Codes are attached to inventory items

Refers to type of material, production process

Can be used as filters for parts, orders and related reports

Shared Features

Require 4 GL Codes when created

AR Account

Discount Account

Sales Account

Freight Account

Drives how sales are posted to GL when AR invoices are created

Tax Codes (Base Table) Create tax code for each taxing authority dealt with

Will need on for Exempt since tax codes are required on all customer invoices

Create separate tax codes for AR and AP

Create new tax code if tax rate changes

3

Terms Codes (Base Table) Used for both vendors and customers

2 methods of calculation:

Number of Days

Specific Days

Currency Codes (Base Table) Only need to set others if dealing with foreign currencies

When creating AR invoices system uses rate on the date orders are entered not when invoice is created

Accounts Receivable

AR invoices can be created from multiple sources:

Directly from Packing Lists, most common source

Freeform, manual entry of all information

Credit Memos, created from customer returns or manually by placing negative amount for unit price

Invoice from Packing List Detail Tab

Invoice date defaults to packing list date, can edit if necessary

Ship charges can be entered manually if not present on packing list

Not taxable if entered in this field

Line Item Billing Detail Window

Accessed from details button on lower right

GL Code must be selected for each line item on invoice

Header Tab

Pulls from customer code, can edit

Can update location to be printed on invoice

Notes Tab

Comments pull from customer code and print on invoice

Can edit as needed

Print Invoice

Additional invoice text can be used to print standard text on invoices. User specific

Freeform Invoice Select customer code and enter parts directly on grid

Access billing details to assign correct GL code and product code

Recurring Invoices Use copy utility to create multiple copies at once

Can edit future copies as necessary

Auto Billing Utility Ability to creates multiple invoices at once

Recommended to clear print spool prior to processing

4

Exercise #2: Create AR Invoice from Packing List

AR | Billing | New

Click Search

Select Packing List Number = 5558

Click OK

Select Job Number = 7174-01

Click OK

Ship Charges = $10.00

Add 2nd Line Item

Part Number = Special Packaging Charge (manually entered)

Qty. Ordered = 1

Unit Price = $15.00

Edit Billing Details for 2nd Line Item

Select Part Number field and right click

GL Account = 4030 Freight Income

Taxable = Yes

Click OK to save & exit billing details

Header Tab

Sales Tax Code = KY

Terms Code = 1% NET 30


Print Invoice

Click Print button on billing search screen

Additional Invoice Text = Thank you for your business!

Company Name At Top = Yes

Print Cash Discount Message = Yes

Company Location = CINCINNATI

Report Destination = Screen

Select Invoice Number = 5558

Click Single Invoice

Review Invoice

Click Close

Exercise #3: Create Credit Memo

AR | Billing | New

Customer Code = BASS

Invoice Number = 5553-CM (override existing)

Part Number = CREDIT (entered manually)

Qty. Ordered = 1

Unit Price = -$50.00 (entered as negative value)

Description = Credit for scratched parts


5

Finance Charge Utility Similar to Auto Billing utility in functionality

Invoices will display as long as they meet criteria

Invoice has terms code with a late fee percentage

Invoice is beyond its stated due date

Work Code is used to determine where finance charge income should be assigned with regard to GL code

Cash Receipts Can be created directly from invoice or manually

Any credit memo invoices need to be pulled onto a cash receipt to remove them from the aging report

If payment amount is less than invoice total, invoice will be still be considered unpaid

Bank code provides GL code

Miscellaneous Cash Receipts Refers to receipt of funds without associated invoice

Customer code still required

Create a Miscellaneous Customer Code

Invoice number and invoice total fields are system maintained, enter amount received under gross amount field

Manually select GL code to credit

Exercise #4: Create Cash Receipt from Invoice

AR| Cash Receipt | New

Check Number = 5241

Customer Code = BASS

Click Search

Select Invoice Numbers = 5553 & 5553-CM

Click OK


Exercise #5: Create Miscellaneous Cash Receipt

AR | Cash Receipt | New

Check Number = Today’s date

Customer Code = MISC

Gross Amount = $100.00

GL Code = 4025 Sales – Other

Comments = Robert Jones – Scrap Sales

Click OK


6

Accounts Receivable Reports

AR Aging Summary displays all open invoices

Should balance against General Ledger AR account at the end of the month

Sales Summary lists all customer invoices entered in system in the specified time frame

Deposit Summary lists all deposits made based on criteria selected

Statements will allow to generate customer statements

Commission Summary lists all commission due on amounts paid and unpaid

If commissions are calculated based on amounts paid, use the deposit summary report by salesman breakdown

Unbilled Shipment Summary displays packing lists that have not yet been billed

AR Sales Tax Summary lists invoices where sales tax was applied

Accounts Payable

AP invoices can be created from multiple sources:

Directly from Receivers, most common source

Freeform, manual entry of all information

Debit Memo, created from vendor return or manually by entering a negative amount

Invoice from Receiver Detail Tab

Invoice date defaults to receiver date, can edit if necessary

Discount date and net due date calculate from invoice date

Ship charges can be entered manually if not present on receiver

Not taxable if entered in ship charges field

If there is a discrepancy between the invoice total and the purchase order total, can edit unit price on purchase order through

Update PO button

Will need to manually update the invoice amount or reselect receiver

Hold payment will prevent invoice from being pulled on to a check

Header Tab

Pulls from vendor code, can edit

Miscellaneous Job Costs Tab

Used to add costs from invoice to specific job(s)

Freeform Invoice (Miscellaneous Purchase) Invoice date defaults to today’s date

GL code defaults to GL code associated with vendor selected

Recurring Invoices Use the copy utility to create multiple invoices at once

Edit future copies as necessary

7

Exercise #6: Create AP Invoice from Receiver

AP | Vendor Invoices | New

Invoice Number = 6218

Vendor = JORGENSEN

Click Search

Select Receivers Number = 3580 & 3585

Click OK

Update Unit Cost on Purchase Order

Click Update PO button

Part Number = 1018-0.125X0.3125-FT

Unit Cost = $0.31 (override existing)

Part Number = 12L14-1.00

Unit Cost = $5.57 (override existing)


On Invoice

Update invoice amount manually

Another option is to cancel out of invoice without saving. Create a new invoice and reselect the receivers

Exercise #7: Create AP Invoice for Miscellaneous Purchase

AP | Vendor Invoices | New


Vendor = FEDEX

Invoice Date = Last Friday

Amount = $150.00

On Misc. Job Costs Tab

Job Number = 7177-01

Part Number = Freight (overwrite existing)

Quantity = 1

Cost = $20.00

Job Number = 7180-01

Part Number = Freight (overwrite existing)

Quantity = 1

Cost = $50.00


Check Writing Checks can be created in multiple ways

Directly from Invoices

Manually

Auto Check Utility

8

Check from Invoice All information pulls from invoice

Can pull multiple invoices on a single check

A single check can contain up to 15 invoices

Check Number pulls from bank code table, can edit

If customer is paying less than the invoice balance edit the gross amount

Invoice will remain unpaid until full balance is paid

Manual Check Since no invoice will be selected, line 1 of the header tab must be filled in first

GL code is selected manually

1099s will not be generated for manual checks

Auto Check Writing Utility Ability to create multiple checks at once

Recommended to clear the print spool prior to processing

Can close utility and save selections without processing

Voiding Checks Select check(s) to void from the search grid and click the void button

Once voided, all invoices on check will be marked unpaid

Cannot void check from a posted period or a closed year

In this case, use a journal entry to offset the effect on cash

Exercise #8: Create Check from an Invoice

AP | Check Writing | New

Vendor = FEDEX

Click Search

Select Invoice Number = 1247

Click OK


Exercise #9: Create a Manual Check

AP | Check Writing | New

On Header Tab

Line 1 = Gold Star Electric

On Detail Tab


Gross Amount = $840.28

GL Account = 5150 Maintenance & Repair


9

Bank Reconciliation Does not impact general ledger, uses information from the check register

Enter statement ending balance from bank statement

Ending date must be last day of month being reconciled regardless of closing date on bank statement

E2 looks at the full month, nothing outside of the month to balance

Journal entries can only be cleared once. Once cleared, it will not display on any other bank code

Will need to create 2 separate journal entries for transactions requiring 2 bank codes

Can exit utility without processing and save selections

Once all cleared items are marked, Out of Balance amount should be zero

Strongly recommend to print reports Before and After processing

Accounts Receivable Reports

AP Aging Summary displays all open invoices

Should balance against General Ledger AP account at the end of the month

Vendor Invoice Summary will show what is hitting each general ledger code in current period without posting

Check Summary lists all checks written within the criteria selected

Checkbook Register will display both checks and deposits

Unbilled Receiver Summary displays receivers that have not yet been billed

AP Sales Tax Summary lists invoices where sales tax was paid

General Ledger

Journal Entries Bank code is not required, system looks to GL code to know what bank code to associate the transaction with

Double sided entry

Credits and Debits must balance to be saved

When creating reversing journal entries

Date to reverse must be entered prior to saving the journal entry for the first time

Miscellaneous Job Costs tab can be used to add costs from the journal entry to specific job(s)

Copy function can be used to create recurring journal entries

Exercise #10: Create a Recurring Journal Entry

GL | Journals | New

Transaction Date = First day of the current year

GL Code = 1805

Credit = $1,200.00

GL Code = 1815

Credit = $800.00

GL Code = 1825

Credit = $500.00

10

GL Code = 5155

Debit = $1,200.00

GL Code = 6165

Debit = $1,300.00

Explanation = Monthly Dep

Comments Tab = Month End Depreciation Entry


Create Recurring Journal Entries

Select Journal entry just created from search grid

Click Copy

Number of Copies = 11

Recurrence Unit = Monthly

Interval = 1

Click OK

Click Search all to see recurring journal entries

Month End Entries

The way in which material is purchased is very important in deciding what entries will be made at the end of each month

Entries are made to adjust Inventory, Cost of Goods Sold (COGS), and Work in Process

These are reversing entries

3 reports to run:

Unbilled Receivers

WIP Summary

Inventory Summary – NOT back dateable! Must run on last day of month

Other Entries Journal entries for payroll if not using an interface

Journal entries for depreciation and amortization

**This is not intended to be an exhaustive list but rather provide an overview of the kind of entries needed each month. For

assistance with specific entries, consult with your accountant and coordinate with an E2 consultant as appropriate

Posting Periods

Located under GL | Journals | Process

2 years available from fiscal year begin date entered under company maintenance

Adjustment periods allow for year-end entries that do not belong in any specific month

Ability to post and un post periods

Can select multiple periods at once to post and un post

Cannot un post a locked period, will need SQL statement to unlock

Once month is posted, run financial reports and verify balances

11

Year End Process

Before posting a fiscal year, run 4 core financial reports:

Balance Sheet

Income Statement

Trial Balance

General Ledger Summary

Follow these steps to process fiscal year:

Create back up database

Create history company

For times in the future when historical financial reports are needed

In Main database, un post any periods outside fiscal year

Click Post Year

Once processed:

Income & Expense accounts are zeroed out

Current Earning roll into Retained Earnings

Fiscal Year Begin Date in company maintenance rolls forward 12 months

Core financial reports can no longer be printed for year posted

***********************************************************************************************************

If you have already implemented E2 Accounting, the rest of this session may not apply to you.

Feel free to leave the session or you may wish to remain online and observe or practice

Implementing E2 Accounting

Important Dates Fiscal Year Begin Date

Go Live Date

Can be any month within fiscal year but must be the first of the month

Date of oldest outstanding record

Reports Needed from Prior System Accounts Receivable Aging

Accounts Payable Aging

Outstanding Checks

Trial Balance for General Ledger Balances

Company Maintenance Considerations Verify fiscal year begin date is set far enough in time

Consider temporarily disabling next number options

Entering Open Items Open Invoices (AR and AP)

Need each open invoice entered individually for accurate aging information

Once entered, run aging summaries in E2 and balance against aging summaries from prior system

12

If Shop Floor portion of E2 is already in use

Packing lists and receivers can be used to create open invoices

Packing lists and receivers need to be updated manually regarding previously paid invoices

Outstanding Checks

Enter as manual checks with original check date and number

Verify amounts against bank statement

Beginning Balances

Use month end reports for the last month from prior system

Reminder: credit balances are entered with a minus sign

If operating on a short year enter values for Income, Expenses and Current Earnings

DO NOT POSTPONE USE OF SYSTEM

Reset Fiscal Year Begin Date Once all open items have been entered, reset the fiscal year begin date to the Go Live Date

Prevents skipped periods from being posted by accident

Keeps check register in sync with financials

Year End Considerations (if operating on a short year) Create a backup database

Un post periods outside fiscal year to post

Reset fiscal year begin date in company maintenance to company’s actual fiscal year begin date

Create history company

Process fiscal year

Contact Information

Sales: 800-525-2143

Support: 800-677-9640

[email protected]

[email protected]

mailto:[email protected]

mailto:[email protected]

virtual training workbook - shoptech the e2 shop system

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