Example: Allocating Expenses with Variable Percentages based on YTD Amounts from Statistical Accounts
Prerequisites
- The appropriate allocation and statistical accounts must exist in the Chart of Accounts form.
- Unit code combinations that are assigned to a statistical account must also be assigned to any distribution accounts that are associated with the statistical account through a Chart of Accounts Allocation sequence.
Chart of Accounts
You could set up a statistical account 7777777 in the Chart of Accounts form, where unit code 1 holds the department numbers for your company.
You could also set up an allocation account 99870 that has the unit codes assigned the same way they are assigned in account 7777777.
Chart of Accounts Budget and Plan
In the Chart of Accounts Budget and Plan form, for account 777777, specify a department number in the Unit Code 1 field, and then specify a starting number of employees for that department in the Actual Change field. Add the same information for the rest of your departments.
Then use the Actual Change field to keep track of the growth or reduction of people in each department from month to month. As the department YTD personnel change each month, the department's percentage of the whole company's YTD personnel also varies, as shown in this chart:
Statistical Account 777777
| Unit code (department) | Period | Actual change | YTD total | Percentage of all depts |
|---|---|---|---|---|
| 100 | 1 | 50 | 50 | 50/100=50% |
| 100 | 2 | 4 | 54 | 54/124 = 44% |
| 100 | 3 | 0 | 54 | 54/129 = 42% |
| 100 | 4 | -2 | 52 | 52/149 = 35% |
| 100 | 5 | 0 | 52 | 52/149 = 35% |
| 100 | 6 | -10 | 42 | 42/159 = 26% |
| Unit code (department) | Period | Actual change | YTD total | Percentage of all depts |
|---|---|---|---|---|
| 200 | 1 | 30 | 30 | 30/100 = 30% |
| 200 | 2 | 20 | 50 | 50/124 = 40% |
| 200 | 3 | 0 | 50 | 50/129 = 39% |
| 200 | 4 | 22 | 72 | 72/149 = 48% |
| 200 | 5 | 0 | 72 | 72/149 = 48% |
| 200 | 6 | -20 | 52 | 52/159 = 33% |
| Unit code (department) | Period | Actual change | YTD total | Percentage of all depts |
|---|---|---|---|---|
| 300 | 1 | 20 | 20 | 20/100 = 20% |
| 300 | 2 | 0 | 20 | 20/124 = 16% |
| 300 | 3 | 5 | 25 | 25/129 = 19% |
| 300 | 4 | 0 | 25 | 25/149 = 17% |
| 300 | 5 | 0 | 25 | 25/149 = 17% |
| 300 | 6 | 40 | 65 | 65/159 = 41% |
Chart of Account Allocations
You can then, for example, use the Chart of Account Allocations form to allocate the monthly cost of protective clothing, based on the variable percentage of people in each department every month. You would set up the Chart of Account Allocations form using values like these:
Allocation Account 99870
| Sequence | Basis Type | Basis Rate | Unit 1 | Allocate by Statistical Account | Statistical Account |
|---|---|---|---|---|---|
| 1 | Percentage | 100 | Yes | 7777777 |
In this case, the allocation account would use the current YTD percentages from the statistical account to distribute the expense across the departments. In Period 2, the allocation would be like this:
- Dept 100 44%
- Dept 200 40%
- Dept 300 16%
But with some movement of personnel every month, the allocations are automatically changed without you having to create new rules. By Period 6, the allocations have changed quite a bit:
- Dept 100 26%
- Dept 200 33%
- Dept 300 41%
You could use the statistical account values as only part of the allocation rule. For example, you might want to allocate the first $75 of each month's bill to department 400, but divide the rest among the other departments. In that case, your Chart of Account Allocations rule would look like this:
| Sequence | Basis Type | Basis Rate | Unit 1 | Allocate by Statistical Account | Statistical Account |
|---|---|---|---|---|---|
| 1 | Amount | $75 | 400 | No | |
| 2 | Percentage | 100 | Yes | 7777777 |