Project Jobs using the One-Off Item feature

Scenario:  Many customers do not have a standard product line or BOM.  Their jobs are more of a project type and often require progressive billing as the work is performed over a period of time.  

Recommendation:  Use a One-Off item in your Sales Order detail and generate a job linked to that line.  The advantages of having a job with an output (quantity = 1) are many.  This will allow for work in process accounting as you issue material and labor to this job over a period of time.  You will also be able to perform progressive billing at stages of the project by invoicing for a fraction of the project (see below).  The output line provides additional flexibility if you wish to attach tracking characteristics or in the rare case you need to stock the finished project for any reason.  

Steps to generate a Project Make Job linked to a SO Line:

  • In Sales Order details, select a new line of Line Type = "One-Off"
  • Provide a useful description.  You may consider including the customer name in the description. (i.e. Project - John Galt)
  • Set the quantity for the project to 1.  Provide the best estimate up front for the overall price of the project.  Many project type jobs do not have a firm price up front, but a good approximation will do.  It can be changed later.
  • Use the "Links" button and Generate Planned Jobs to create a Job for your project with the “Generate Planned Jobs for CTO Items” screen that appears.

Now that you have a job for your project, this new job will act as the main folder to collect all of your project costing details.  As you add detail lines and/or routings to the job, this will establish your overall Job Estimate.  You can copy in phantom BOMs or copy a previous job to help you build your project job more rapidly.  Optionally, you can add routings to this job to report labor.   

Progress Billing:  You can perform progressive billing against your project by performing partial completions of your project.  For example, if you wished to bill for 50% of the project you could receive .5 of the finished output (Jobs – Job Receipts).  You would then go into your Sales order and order pick a qty of .5 and then create a shipment and then invoice (detailed below).

Special Considerations:

  • If you plan on performing progressive billing, you should ensure that as you pick a partial quantity that you are not picking at a zero costs.  You will be required to first receipt a portion of your project at job estimated cost in order to bill.
  • Because projects are custom in nature, we suggest you set your Jobs - Jobs Setup - Job Defaults to a Job Receipts Cost basis to "Actual Job Cost".
  • If you do not have many of your job details known up front, you may consider creating a descriptor to better approximate your overall job estimate.  For example, if the overall job estimate is $1000 and you only have $500 worth of material and labor details known up front, you can consider adding a descriptor to represent the additional $500.  This will get your overall job estimate closer in line with your actual costs.  You will need to delete this descriptor when you actually add the job details later.
  • Partial quantity picking will base the invoice value at Qty times the total price.  The price against the SO line is for the entire project.  If you want to bill $500 for 50% of a project, you will need to set the overall price at $1000.  Try to get the overall price against the SO line for your project as close to the complete project price as possible.

Steps for progress billing

  • In order to ensure that you have a more accurate reflection of your COGs, you will need to receipt a partial quantity of your project in Jobs – Job Receipts.  In our example, we would receipt a quantity of .5 for 50%.  The cost will be based on your job estimate at the time of this transaction (see point three above).  Partial receipts are always done at job estimate.  
  • You can now go to the sales order and order pick a quantity of .5. The amount invoiced will be .5 x the overall price of the project (see point four above)
  • Create a shipment.  This may just be a dummy transaction if you do not actually ship anything.
  • Create an invoice for your .5 quantity.  Add any invoice notes to provide a more clear description of what you are doing.  i.e. "50% of overall project..."
  • This process can be repeated until you complete the project and receipt the final portion of the output.   At the time of receipt of the final portion of your output the system will reconcile all of the actual job costs versus WIP and adjust the final qty unit cost accordingly.  The overall costing will be based on the weighted average of each of the partial receipts and their respective suggested unit costs.