Offset entries

Allocation transactions are one-sided or balanced. If you post a balanced allocation transaction, then you must define an offset activity and account category. For example, when Moosewood Outfitters allocates costs from the Design activity in a new store project, they increase costs in other activities in the project. They can create an offset entry that reduces the balance in the Design activity to avoid overstating costs on reports or inquiries that include all activities in the project.

If the allocation pool is comprised of many activities, then you can define a special contra activity that you use for the offset entry. For example, if design costs are collected in multiple activities, then you can create an Allocated Design Costs activity. You can also define one or more account categories for allocation offset entries.

Optionally, you can post allocations generated in Project Accounting to Lawson's General Ledger application. You must balance the allocation transactions that you post to General Ledger if they involve amounts. You are not required to balance the unit transactions to General Ledger. This table shows offset entry information you define in each allocation header to accomplish the posting results: