Exercise 5: Configure Chart of Accounts and Posting Groups

Task 1: Configure the Chart of Accounts

Scenario

During the implementation process, Contoso’s superusers are systematically informed and trained in different areas of the system during work sessions. After following the work sessions about the chart of accounts, posting groups and dimensions, the accounting manager has reviewed Contoso’s chart of accounts and has added some g/l accounts. The further setup of posting groups is done in collaboration with you, the functional consultant.

Some accounts were added to distinguish very easily between purchases and sales made within their own country, and for each product type, without having to set up even more dimensions. These accounts will be posted to through the setup of posting groups.

Also the expenses are more detailed, where we can see a clear separation between staff-related expenses and other expenses. All staff-related expenses are posted to the g/l accounts 60700 until 61100, where it is obligated to indicate a specific department each time an expense is made.

Your first job is to make sure the g/l accounts are created correctly and that the necessary dimensions are connected.

Remark: for the income statement accounts, make sure to fill in the Tax Group Code with the NONTAXABLE value.

You will perform

1. Create a G/L Account card.

2. Assign default dimensions to multiple G/L Accounts.

Steps

1. Create a G/L Account card.

   1. Select the Search icon in the top-right corner of the page, enter Chart of Accounts and then choose the related link.

   2. In the Chart of Accounts page, select + New.

   3. In the new general ledger account card, fill in the following fields:

      1. In the No. field, enter 10250

      2. In the Name field, enter European bank.

      3. In the Income/Balance field, select the value Balance Sheet.

      4. In the Account Category field, select the value Assets

      5. In the Account Subcategory field, select the value Cash.

      6. Deselect the option Direct Posting.

      7. Close the G/L Account Card page.

   4. In the Chart of Accounts page, select + New.

   5. In the new general ledger account card, fill in the following fields:

      1. In the No. field, enter 10450

      2. In the Name field, enter Accounts Receivables – Foreign.

      3. In the Income/Balance field, select the value Balance Sheet.

      4. In the Account Category field, select the value Assets

      5. In the Account Subcategory field, select the value Accounts Receivables.

      6. Deselect the option Direct Posting.

      7. Close the G/L Account Card page.

   6. Repeat steps c for account 10475.

   7. In the Chart of Accounts page, select + New.

   8. In the new general ledger account card, fill in the following fields:

      1. In the No. field, enter 10710

      2. In the Name field, enter Inventory – Computer Hardware.

      3. In the Income/Balance field, select the value Balance Sheet.

      4. In the Account Category field, select the value Assets

      5. In the Account Subcategory field, select the value Inventory.

      6. Deselect the option Direct Posting.

      7. Close the G/L Account Card page.

   9. In the Chart of Accounts page, select + New.

   10. In the new general ledger account card, fill in the following fields:

       1. In the No. field, enter 20150

       2. In the Name field, enter Accounts Payable – Foreign.

       3. In the Income/Balance field, select the value Balance Sheet.

       4. In the Account Category field, select the value Liabilities

       5. In the Account Subcategory field, select the value Current Liabilities.

       6. Deselect the option Direct Posting.

       7. Close the G/L Account Card page.

   11. Repeat steps h for the account 20175.

   12. In the Chart of Accounts page, select + New.

   13. In the new general ledger account card, fill in the following fields:

       1. In the No. field, enter 40210

       2. In the Name field, enter Product Sales – Computer hardware.

       3. In the Income/Balance field, select the value Income Statement.

       4. In the Account Category field, select the value Income

       5. In the Account Subcategory field, select the value Income, Product Sales.

       6. Deselect the option Direct Posting.

       7. In the Posting FastTab, in the Tax Group Code field, select NONTAXABLE.

       8. Close the G/L Account Card page.

   14. In the Chart of Accounts page, select + New.

   15. In the new general ledger account card, fill in the following fields:

       1. In the No. field, enter 50150

       2. In the Name field, enter Materials - Computerhardware.

       3. In the Income/Balance field, select the value Income Statement.

       4. In the Account Category field, select the value Cost of Goods Sold

       5. In the Account Subcategory field, select the value Materials.

       6. Deselect the option Direct Posting.

       7. In the Posting FastTab, in the Tax Group Code field, select NONTAXABLE.

       8. Close the G/L Account Card page.

   16. In the Chart of Accounts page, select + New.

   17. In the new general ledger account card, fill in the following fields:

       1. In the No. field, enter 61450

       2. In the Name field, enter Travel Expenses.

       3. In the Income/Balance field, select the value Income Statement.

       4. In the Account Category field, select the value Expense

       5. In the Account Subcategory field, select the value Utilities Expense.

       6. Deselect the option Direct Posting.

       7. In the Posting FastTab, in the Tax Group Code field, select NONTAXABLE.

       8. Close the G/L Account Card page.

   18. In the Chart of Accounts page, select + New.

   19. In the new general ledger account card, fill in the following fields:

       1. In the No. field, enter 61850

       2. In the Name field, enter VAT.

       3. In the Income/Balance field, select the value Income Statement.

       4. In the Account Category field, select the value Expense

       5. In the Account Subcategory field, select the value Tax Expenses.

       6. Deselect the option Direct Posting.

       7. In the Posting FastTab, in the Tax Group Code field, select NONTAXABLE.

       8. Close the G/L Account Card page.

   20. In the Chart of Accounts page, select Home and then select Indent Chart of Accounts.

   21. Click Yes.

2. Assign default dimensions to multiple G/L Accounts.

   1. In the Chart of Accounts page, select general ledger accounts 60110 until 61100.

   2. Select Account, then Dimensions-Multiple, and then select Dimensions – Multiple.

   3. In the Default Dimensions-Multiple page, select + New.

   4. In the Dimensions Code field, enter DEPARTMENT.

   5. In the Value Posting field, enter the value Code Mandatory.

   6. Click OK.

Task 2: Set up posting groups

Scenario

Contoso recently decided to start selling computer hardware through their European web shop. To keep track of these new line of product, they will record these sales on a separate income statement account 40210, apart from the other retail activities. They will have to comply to European legislation and calculate 15% VAT on all their web shop sales. This VAT amount will be posted to the general ledger account 61850. (Remark: this is just for exercise purposes and not based on actual legislation.)

The products are mainly purchased with export vendors, no VAT needs to be paid in these countries. Purchase with EU vendors is however also possible.

The necessary general ledger accounts were already created in the previous exercise. It is now up to you to complete the General Posting Setup and the VAT Posting Setup.

You will perform

1. Create a VAT Product Posting Group.

2. Create a VAT Business Posting Group.

3. Complete the Tax Posting Setup.

4. Create a Product Posting Group.

5. Create a Business Posting Group.

6. Complete the General Posting Setup.

Steps

1. Create a VAT Product Posting Group.

   1. Select the Search icon in the top-right corner of the page, enter VAT Product Posting Groups and then choose the related link.

   2. In the VAT Product Posting Groups page, select + New.

   3. In the Code field, enter G15.

   4. In the Description field, enter Goods 15%.

2. Create a VAT Business Posting Group.

   1. Select the Search icon in the top-right corner of the page, enter VAT Business Posting Groups and then choose the related link.

   2. In the VAT Business Posting Groups page, select + New.

   3. In the Code field, enter EU.

   4. In the Description field, enter EU.

3. Complete the Tax Posting Setup.

   1. Select the Search icon in the top-right corner of the page, enter Tax Posting Setup and then choose the related link.

   2. In the Tax Posting Setup page, select + New.

   3. In the new tax posting setup card, fill in the following fields:

      1. In the VAT Bus. Posting Group field, enter EU.

      2. In the VAT Prod. Posting Group field, enter G15.

      3. In the VAT Calculation Type field, enter Normal Tax.

      4. In the Description field, enter web shop sales.

      5. In the Tax% field, enter 15.

      6. In the Tax Identifier field, enter G15.

      7. In the Sales Tax Account field, enter 61850.

4. Create a Product Posting Group.

   1. Select the Search icon in the top-right corner of the page, enter General Product Posting Groups and then choose the related link.

   2. In the General Product Posting Groups page, select + New.

   3. In the Code field, enter COMPUTERHW.

   4. In the Description field, enter computer hardware.

   5. In the Def. VAT Prod. Posting Group field, enter G15.

5. Create a Business Posting Group

   1. Select the Search icon in the top-right corner of the page, enter Gen. Business Posting Groups and then choose the related link.

   2. In the Gen. Business Posting Groups page, select + New.

   3. In the Code field, enter EU.

   4. In the Description field, enter EU customer and vendors.

   5. In the Def. VAT Bus. Posting Group field, enter EU.

   6. In the Gen. Business Posting Groups page, select + New.

   7. In the Code field, enter EXPORT.

   8. In the Description field, enter Export customer and vendors.

   9. Leave the Def. VAT Bus. Posting Group field blank.

6. Complete the General Posting Setup.

   1. Select the Search icon in the top-right corner of the page, enter General Posting Setup and then choose the related link.

   2. In the General Posting Setup page, select + New.

   3. In the new general posting setup card, in the General FastTab, fill in the following fields:

      1. In the Gen. Bus. Posting Group field, fill in EU.

      2. In the Gen. Prod. Posting Group field, fill in COMPUTERHW.

   4. Select Copy.

   5. In the page that opens, fill in the following fields:

      1. In the Gen. Bus. Posting Group field, fill in DOMESTIC.

      2. In the Gen. Prod. Posting Group field, fill in RETAIL.

      3. In the Copy field, select the All fields option.

      4. Leave all the checkboxes selected.

      5. Click OK.

      6. Click Yes.

   6. In the new general posting setup card, in the Sales FastTab, change the following fields:

      1. In the Sales Account field, update the value to 40210

      2. In the Sales Credit Memo Account field, update the value to 40210

   7. In the new general posting setup card, in the Purchases FastTab, change the following fields:

      1. In the Purch. Account field, update the value to 50150.

      2. In the Purch. Credit Memo Account field, update the value to 50150.

   8. In the General Posting Setup page, select + New.

   9. In the new general posting setup card, in the General FastTab, fill in the following fields:

      1. In the Gen. Bus. Posting Group field, fill in EXPORT.

      2. In the Gen. Prod. Posting Group field, fill in COMPUTERHW.

   10. Select Copy.

   11. In the page that opens, fill in the following fields:

       1. In the Gen. Bus. Posting Group field, fill in EU.

       2. In the Gen. Prod. Posting Group field, fill in COMPUTERHW.

       3. In the Copy field, select the All fields option.

       4. Leave all the checkboxes selected.

       5. Click OK.

       6. Click Yes.