How to Handle Shipping Costs on Purchase Orders

We are having a problem on purchase orders in Quickbooks 2004. At the time we place an order we do not know the shipping cost. This gets entered on the PO with $0 cost.

Our inventory manager receives against the PO at the time we receive the items, but again she has no invoice and she cannot record shipping costs.

Now later we receive an invoice from the vendor, and it has the shipping cost. My accounts payable person has been coming to me and asking me to make these corrections, and from what I have seen so far I am pretty horrified at how difficult it is to rectify the situation. The steps I have been doing to work around this situation:

1) I modify the purchase order that is already received in full, by entering in the shipping costs, and changing the quantity field of the shipping line item from 0 to 1. If the quantity remains unchanged, the PO will fail to appear in the next step!

2) I modify the Item Receipt by doing a "Select PO" and reselecting the already received PO. Now the shipping costs appear. I have to manually retotal the items in the Item Receipt, because the total of the Item Receipt form does NOT adjust to the newly selected PO.

3) I save all this, and only now can the purchase order be paid.

Is there a better way to do this? The above procedure requires too much attention to detail, and would in general be difficult for someone who was not extremely computer literate to deal with.

I count the following behaviors in the above sequence as bugs in Quickbooks:

1) From inside the Item Receipt, the "Select PO" feature fails to find any open PO if the dollar amount of the PO has changed. Only changing a quantity will allow the PO to show again. The PO should not be showing as received if any material detail of that PO has been modified, if for no other reason than good financial controls.

2) From inside the Item Receipt, selecting a PO a second time fails to modify the total amount for the PO in the total line at the top of the Item Receipt.

Reply to
Will
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Why can't your A/P person add-in the shipping at the time of PO-->Invoice creation in QB? You really didn't "purchase" shipping anyway. Its a cost of doing business with vendors and usually isn't part of a PO (for the same reason you site above).

Reply to
Tee

Doesn't sound like a QuickBooks problem, but an internal procedure issue. Why can't the AP add the shipping, and save all this hassle?

G
Reply to
Gary

Low end accounting programs especially those like Quickbooks that never handled inventory well in the first place really can't do what you want automatically. It is not a bug, the program just lacks the functionality.

A user should not only be able to record additional charges conected with the receipt of goods from the vendor you purchased the items from but but also costs from other vendors as well. These additional costs should also be automatically allocated to the items received even when the invoice(s) are received after the receipt of the goods.

Reply to
Allan Martin

Hello

I normally add 30% to total as a shipping cost to the PO. Create Item Shipping and manually figure the amount on the po... when items arrive .. I UPDATE the po to show correct shipping cost.. that way the invoice to be paid is the same as the po..

works for me

Reply to
kawika

I guess it is safe to assume you do not sell diamonds or gold.

Reply to
Allan Martin

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