Set up item charges

Item charges have a specific configuration for managing the value entries associated with specific item charge codes during the settlement process. This configuration is applicable when calculating the settlement for purchase orders with the Accounting Method field set is as Account Sale or Pooling. Only these types of settlement value entries representing revenue or costs are considered.

On the Item Charges page, in the Account Sale Type field, the following options are available.

• Cost: Item charges with this option are considered costs by the account sale calculation and can be added to the cost template. For more information, see Cost template. Value entries associated with this item charge are displayed in one of the two ‘costs’ sections on the Account Sale page.
• Accrual: Item charges with this option are considered accruals by the account sale calculation. They represent a rebate that is initially posted as a cost in the system, assuming that the posted amount will be paid out to a specific customer after a certain period. For more information, see Understand discounts calculation. Value entries associated with this item charge are displayed as Discounts on the Account Sale page.
• Price correction: Item charges with this option are considered corrections on previously posted revenue in other sales documents by the account sale calculation. Value entries associated with this item charge are displayed as Revenue on the Account Sale page.