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They are not required by Clients & Profits ASAP, but give you control over your purchases. That’s because purchase orders provide written verification for the goods and services you order.
Anyone can add their own purchase orders, up to a user-defined dollar limit. POs have at least one job and task, but can contain several for better cost accounting. Amounts from the purchase order update job tickets automatically. When the vendor’s invoice is posted and the PO is referenced, the PO is reconciled automatically.
Tracking purchase orders can be essentially paperless, since you can add, change, and see everything about a PO directly from your web browser. The cost of your orders will appear on job reports. Purchase orders aren’t true job costs; instead, they are commitments you’ve made for a job cost. They are essential for accurate cost accounting, since they track the purchases you’ve made throughout the month, but still haven’t received the vendor’s invoice.
A job ticket can have hundreds of purchase orders; there’s no real limit. Job commitment reports can be quickly printed (or reviewed directly from your computer) showing just what you’ve ordered -- and whether or not it has been invoiced by the vendor. Many parts of the purchase order are customizable to save time. Templates, which contain basic details about a kind of purchase, can be applied to a new purchase order, for faster data entry.
When the cost is eventually invoiced by the vendor, the purchase order’s balance decreases. The purchase order keeps a running balance of open commitments, showing you how much you’ve purchased from vendors that hasn’t been invoiced. Once the invoice is posted in Accounts Payable, a purchase order can’t be changed.
Whether you’re ordering printing for clients, print or broadcast media, or supplies for the office, everything is added into the Purchase Orders’ record in your ASAP database.
To add a purchase order
1 From the Purchase Order web page, click the add button.
The Add Purchase Order web page opens. Purchase orders are numbered automatically by Clients & Profits ASAP.
2 Select a vendor from the vendor pop-up menu.
Vendor Every purchase order is added for only one vendor. The vendor name, address, and markup are copied to the purchase order automatically from the vendor file, and appear on the printed form.
3 Enter the Date, Due date, and Description.
The order date is the date the purchase order was added. Due date is the date on which the work is to be delivered. The description can contain any kind of useful information that explains what you’re ordering. The line item description appears in the body of the purchase order. It should be used to briefly describe (in 50 letters or less) just what is being ordered. It will be copied from the task description, but can be changed.
4 If applicable, enter the Purchase Order's Instructions.
5 Enter the Job and Task.
The job and task are essential for accurate cost accounting. A purchase order must have at least one job and task. (It can be charged to many jobs by checking the charge to many job tickets and tasks option, which is described in the To add amounts to a purchase order.)
If the purchase order is for a non-job purchase, such as overhead, enter NONE as the job number. This tells the purchase order to ignore the task, markup, and other job costing details.
6 Enter the Quantity, Markup, Net Cost, and Gross.
Net cost is the expected cost of the work -- what you will eventually pay this vendor for their work -- before commissions and markups. Markup is the percentage (entered as 17.65, 25.00, etc.) amount that is added to the net cost to calculate your gross amount. Gross is the amount your client will later be billed for this work, including commissions and markups. The vendor sees the net cost on the printed purchase order, not the gross amount (except on media insertions, which show gross amounts -- not net costs). Both the net cost and gross amounts appear on the job ticket.
The amount you enter doesn’t have to be exact; instead, it can be the most you’ll allow the vendor to charge. On the printed purchase order, the line item amounts will be totaled. This total will appear at the bottom of the purchase order.
7 Click Save.
Saving the purchase order updates the job’s commitment totals. The PO’s net cost increases the job task’s Net POs balance, while the PO’s gross amount increases the job task’s Gross POs balance. An order can be changed at any time before it is invoiced by the vendor or pre-billed to the client.
To edit a purchase order
1 From the Purchase Order page, find a purchase order.
2 Click the Edit button.
The Edit Purchase Order Amount web page opens, listing the PO's details.
3 Make any necessary changes, then click Save.
Line number The line number is crucial for job costing, since it links the order amount with the vendor's invoice in Accounts Payable. It is also used for sorting amounts on the printed invoice. You can enter any line number, but don't use the same line number twice.
Job and task Every line item (i.e., order amount) needs a job number and task to indicate which job ticket should be updated by this purchase. When the line item is saved, the cost amount increases the job task's committed balance -- showing that you've ordered something from a vendor. If this purchase isn't for a job ticket (ie., overhead), enter the word NONE instead of a job number.
Quantity, Description, cost each, and unit The quantity, cost each, and unit of measure describe the item you're ordering. These fields are optional, and will only appear on detailed purchase order forms (the detailed form setting can be changed later in the Options window). The quantity can be useful for ordering printing (such as 10,000 copies of a brochure). The unit cost can be up to four decimal places, which is useful for specifying small costs. Unit indicates the unit of measure, such as per thousand, each, lot, or other measure.
Net cost, markup, and gross amount The net cost is the amount you're actually paying for this item, before markups and commissions. The net amount updates the net POs total on job tasks. Vendors only see the net cost amount on purchase orders. The markup is copied from the vendor account, but is replaced by the job task's markup (if one is entered). The markup is used to calculate the gross, or billable, amount. Vendors don't see the markup percentage. Gross is the amount that eventually will be billed to the client. It is calculated as the net cost times the markup, but can be changed as needed. The gross amount increases the gross POs total on the job ticket. Vendors don't see the gross amount, since it includes commissions.
If you bill a purchase order, the gross amount -- not the cost amount -- is copied to the client's invoice. To make a purchase order unbillable, don't enter a markup or gross amount. Instead, enter a net cost amount only.
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