Understand Freight Allocations Theresa Rodriguez

Agenda Allocating Inbound Freight To Inventory Purchase Orders Allocating Inbound Freight To Inventory Transfers Allocating Freight To Linked Sales Order

Allocating Inbound Freight To Inventory Purchase Orders

Company Maintenance Set Allocation Flag in Company Maintenance. Freight Allocations – P/O In company maintenance, under ICS information, there is a prompt - 'Freight Allocation - P/O.' If this is answered 'Y' then stock receipts and AP/PO matching will allocate inbound freight charges to average cost and debit the general ledger inventory account for the freight amount. If this question is answered 'I' then freight charges for non-direct ship purchase orders will allocate inbound freight charges to average cost and debit the general ledger inventory account for the freight amount; direct ship purchase orders will post to the general ledger freight account. If this question is answered 'N' then all inbound freight charges entered in AP/PO will debit the general ledger freight account. Set this flag to 'Y' to allocate freight to product average cost during transfer receipts. Freight is calculated on branch transfers by setting up a freight matrix for each shipping and receiving warehouse combination. Freight cost is recalculated upon receipt and added to "Inventory" in the receiving branch. The offset is the "Cost Transfer Freight Out" account at the shipping branch.

Product Line Maintenance Define Allocation Method Dollars Pounds Units Volume No Allocation

Entering Freight Rates Freight Rate Hierarchy Product Warehouse

Entering Freight Rates Freight Rate Hierarchy Product Warehouse Vendor Line

Entering Freight Rates Freight Rate Hierarchy Product Warehouse Vendor Line Product Line – Freight Matrix

Purchase Order Entry Header Set Freight Flag Y – The system calculates estimated freight and notify’s payables that you are responsible for any freight charge on the purchase order N - Freight is not estimated and payables is not notified

Freight Closeout in Purchase Order Entry Set Freight Flag Calculated based on Freight Rates Entered and Allocation Method Can be overridden

Stock Receipt Freight Closeout Screen Set Freight Flag Calculated based on Freight Rates Entered and Allocation Method by what has been received Can be overridden

Accounts Payable Can Override Freight in Accounts Payable

Transaction Audit Inquiry REC Code showing Unit Cost Including Freight A/P Code showing adjustment to Unit Cost

Allocating Inbound Freight To Inventory Transfers

Company Maintenance Set Allocation Flag in Company Maintenance. Freight Allocations – T/R. In company maintenance, under ICS information, there is a prompt - 'Freight Allocation - P/O.' If this is answered 'Y' then stock receipts and AP/PO matching will allocate inbound freight charges to average cost and debit the general ledger inventory account for the freight amount. If this question is answered 'I' then freight charges for non-direct ship purchase orders will allocate inbound freight charges to average cost and debit the general ledger inventory account for the freight amount; direct ship purchase orders will post to the general ledger freight account. If this question is answered 'N' then all inbound freight charges entered in AP/PO will debit the general ledger freight account. Set this flag to 'Y' to allocate freight to product average cost during transfer receipts. Freight is calculated on branch transfers by setting up a freight matrix for each shipping and receiving warehouse combination. Freight cost is recalculated upon receipt and added to "Inventory" in the receiving branch. The offset is the "Cost Transfer Freight Out" account at the shipping branch.

Entering Freight Rates Freight Rate Hierarchy Product Line – Freight Matrix

Transfer Shipment Entry If this flag is set to 'Y' and the purchase order being received has lines that are linked to a sales order, a proportioned freight amount will be calculated and passed along to the sales order's inbound freight field. Note: if freight allocation is used, the freight amount will be calculated along with the percentage of freight to allocate to linked sales orders and displayed to the user in stock receipts. If freight allocation is not used, this option will still calculate the percentage of freight to allocate to linked sales orders but the user will need to manually input the freight amount in stock receipts. If the freight amount is not entered, no freight will be allocated to the linked sales order. A warehouse minimum linked freight dollar amount may also be established in Warehouse Address Maintenance. This optional field will be compared against the calculated freight amount and the highest value will be allocated to the linked sales order's inbound freight field. In stock receipts, the user will be prompted for the total freight. If freight allocation is used, a percentage based on the method of all linked lines received to the total lines received will be calculated, i.e., if the method is $, then what percentage of the total dollar amount is linked. If freight allocation is not used, a percentage is calculated based on the dollar amount. Example: Freight Allocation method is $ and the total freight amount is $75. There are three lines on the purchase order, two are linked to sales orders and one line is for stock. Total Purchase Order Extension Amount is $500. Product A (linked to S/O 100100) - Total $ Extension is $200 Product B (linked to S/O 100200) - Total $ Extension is $150 Product C (not linked) - Total $ Extension is $150 Percentage of Freight To Sales Orders $350 / $500 = 70% 70% of $75 = $52.50 Product A (linked) % of Freight $ = $200 / $350 = 57% Product B (linked) % of Freight $ = $150 / $350 = 43% Freight allocated to Product A Sales Order = $52.50 * 57% = $29.93 Freight allocated to Product B Sales Order = $52.50 * 43% = $22.57 The warehouse address minimum will be checked after the freight amount has been calculated. If the warehouse address minimum freight amount is $10, then no override will be done. If the warehouse address minimum freight amount is $25, then the freight amount for Product B sales order will be replaced with $25 instead of the calculated $22.57. This final freight amount to will added to the inbound freight field for each sales order. The 'I' flag includes the freight cost paid expense as part of the g/l posting for the receiver.

Allocating Freight to Linked Sales Orders

Allocate Linked Freight to S/O If this flag is set to 'Y' and the purchase order being received has lines that are linked to a sales order, a proportioned freight amount will be calculated and passed along to the sales order's inbound freight field. Note: if freight allocation is used, the freight amount will be calculated along with the percentage of freight to allocate to linked sales orders and displayed to the user in stock receipts. If freight allocation is not used, this option will still calculate the percentage of freight to allocate to linked sales orders but the user will need to manually input the freight amount in stock receipts. If the freight amount is not entered, no freight will be allocated to the linked sales order. A warehouse minimum linked freight dollar amount may also be established in Warehouse Address Maintenance. This optional field will be compared against the calculated freight amount and the highest value will be allocated to the linked sales order's inbound freight field. In stock receipts, the user will be prompted for the total freight. If freight allocation is used, a percentage based on the method of all linked lines received to the total lines received will be calculated, i.e., if the method is $, then what percentage of the total dollar amount is linked. If freight allocation is not used, a percentage is calculated based on the dollar amount. Example: Freight Allocation method is $ and the total freight amount is $75. There are three lines on the purchase order, two are linked to sales orders and one line is for stock. Total Purchase Order Extension Amount is $500. Product A (linked to S/O 100100) - Total $ Extension is $200 Product B (linked to S/O 100200) - Total $ Extension is $150 Product C (not linked) - Total $ Extension is $150 Percentage of Freight To Sales Orders $350 / $500 = 70% 70% of $75 = $52.50 Product A (linked) % of Freight $ = $200 / $350 = 57% Product B (linked) % of Freight $ = $150 / $350 = 43% Freight allocated to Product A Sales Order = $52.50 * 57% = $29.93 Freight allocated to Product B Sales Order = $52.50 * 43% = $22.57 The warehouse address minimum will be checked after the freight amount has been calculated. If the warehouse address minimum freight amount is $10, then no override will be done. If the warehouse address minimum freight amount is $25, then the freight amount for Product B sales order will be replaced with $25 instead of the calculated $22.57. This final freight amount to will added to the inbound freight field for each sales order. The 'I' flag includes the freight cost paid expense as part of the g/l posting for the receiver.

Minimum Linked Freight Amount If the calculated freight amount is lower than the Minimum LInked Frt Amt in Warehouse Maintenance > F5-Add Info, the system uses the Minimum LInked Frt Amt from Warehouse Maintenance for Inbound Freight.

Allocate Linked Freight to S/O If this flag is set to 'Y' and the purchase order being received has lines that are linked to a sales order, a proportioned freight amount will be calculated and passed along to the sales order's inbound freight field. Note: if freight allocation is used, the freight amount will be calculated along with the percentage of freight to allocate to linked sales orders and displayed to the user in stock receipts. If freight allocation is not used, this option will still calculate the percentage of freight to allocate to linked sales orders but the user will need to manually input the freight amount in stock receipts. If the freight amount is not entered, no freight will be allocated to the linked sales order. A warehouse minimum linked freight dollar amount may also be established in Warehouse Address Maintenance. This optional field will be compared against the calculated freight amount and the highest value will be allocated to the linked sales order's inbound freight field. In stock receipts, the user will be prompted for the total freight. If freight allocation is used, a percentage based on the method of all linked lines received to the total lines received will be calculated, i.e., if the method is $, then what percentage of the total dollar amount is linked. If freight allocation is not used, a percentage is calculated based on the dollar amount. Example: Freight Allocation method is $ and the total freight amount is $75. There are three lines on the purchase order, two are linked to sales orders and one line is for stock. Total Purchase Order Extension Amount is $500. Product A (linked to S/O 100100) - Total $ Extension is $200 Product B (linked to S/O 100200) - Total $ Extension is $150 Product C (not linked) - Total $ Extension is $150 Percentage of Freight To Sales Orders $350 / $500 = 70% 70% of $75 = $52.50 Product A (linked) % of Freight $ = $200 / $350 = 57% Product B (linked) % of Freight $ = $150 / $350 = 43% Freight allocated to Product A Sales Order = $52.50 * 57% = $29.93 Freight allocated to Product B Sales Order = $52.50 * 43% = $22.57 The warehouse address minimum will be checked after the freight amount has been calculated. If the warehouse address minimum freight amount is $10, then no override will be done. If the warehouse address minimum freight amount is $25, then the freight amount for Product B sales order will be replaced with $25 instead of the calculated $22.57. This final freight amount to will added to the inbound freight field for each sales order. The 'I' flag includes the freight cost paid expense as part of the g/l posting for the receiver.

Allocate Linked Freight to S/O If this flag is set to 'Y' and the purchase order being received has lines that are linked to a sales order, a proportioned freight amount will be calculated and passed along to the sales order's inbound freight field. Note: if freight allocation is used, the freight amount will be calculated along with the percentage of freight to allocate to linked sales orders and displayed to the user in stock receipts. If freight allocation is not used, this option will still calculate the percentage of freight to allocate to linked sales orders but the user will need to manually input the freight amount in stock receipts. If the freight amount is not entered, no freight will be allocated to the linked sales order. A warehouse minimum linked freight dollar amount may also be established in Warehouse Address Maintenance. This optional field will be compared against the calculated freight amount and the highest value will be allocated to the linked sales order's inbound freight field. In stock receipts, the user will be prompted for the total freight. If freight allocation is used, a percentage based on the method of all linked lines received to the total lines received will be calculated, i.e., if the method is $, then what percentage of the total dollar amount is linked. If freight allocation is not used, a percentage is calculated based on the dollar amount. Example: Freight Allocation method is $ and the total freight amount is $75. There are three lines on the purchase order, two are linked to sales orders and one line is for stock. Total Purchase Order Extension Amount is $500. Product A (linked to S/O 100100) - Total $ Extension is $200 Product B (linked to S/O 100200) - Total $ Extension is $150 Product C (not linked) - Total $ Extension is $150 Percentage of Freight To Sales Orders $350 / $500 = 70% 70% of $75 = $52.50 Product A (linked) % of Freight $ = $200 / $350 = 57% Product B (linked) % of Freight $ = $150 / $350 = 43% Freight allocated to Product A Sales Order = $52.50 * 57% = $29.93 Freight allocated to Product B Sales Order = $52.50 * 43% = $22.57 The warehouse address minimum will be checked after the freight amount has been calculated. If the warehouse address minimum freight amount is $10, then no override will be done. If the warehouse address minimum freight amount is $25, then the freight amount for Product B sales order will be replaced with $25 instead of the calculated $22.57. This final freight amount to will added to the inbound freight field for each sales order. The 'I' flag includes the freight cost paid expense as part of the g/l posting for the receiver.

Allocate Linked Freight to S/O If this flag is set to 'Y' and the purchase order being received has lines that are linked to a sales order, a proportioned freight amount will be calculated and passed along to the sales order's inbound freight field. Note: if freight allocation is used, the freight amount will be calculated along with the percentage of freight to allocate to linked sales orders and displayed to the user in stock receipts. If freight allocation is not used, this option will still calculate the percentage of freight to allocate to linked sales orders but the user will need to manually input the freight amount in stock receipts. If the freight amount is not entered, no freight will be allocated to the linked sales order. A warehouse minimum linked freight dollar amount may also be established in Warehouse Address Maintenance. This optional field will be compared against the calculated freight amount and the highest value will be allocated to the linked sales order's inbound freight field. In stock receipts, the user will be prompted for the total freight. If freight allocation is used, a percentage based on the method of all linked lines received to the total lines received will be calculated, i.e., if the method is $, then what percentage of the total dollar amount is linked. If freight allocation is not used, a percentage is calculated based on the dollar amount. Example: Freight Allocation method is $ and the total freight amount is $75. There are three lines on the purchase order, two are linked to sales orders and one line is for stock. Total Purchase Order Extension Amount is $500. Product A (linked to S/O 100100) - Total $ Extension is $200 Product B (linked to S/O 100200) - Total $ Extension is $150 Product C (not linked) - Total $ Extension is $150 Percentage of Freight To Sales Orders $350 / $500 = 70% 70% of $75 = $52.50 Product A (linked) % of Freight $ = $200 / $350 = 57% Product B (linked) % of Freight $ = $150 / $350 = 43% Freight allocated to Product A Sales Order = $52.50 * 57% = $29.93 Freight allocated to Product B Sales Order = $52.50 * 43% = $22.57 The warehouse address minimum will be checked after the freight amount has been calculated. If the warehouse address minimum freight amount is $10, then no override will be done. If the warehouse address minimum freight amount is $25, then the freight amount for Product B sales order will be replaced with $25 instead of the calculated $22.57. This final freight amount to will added to the inbound freight field for each sales order. The 'I' flag includes the freight cost paid expense as part of the g/l posting for the receiver.

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