Product Categories
Overview
Product Category is one area within Readysell whereby you can assign a different general ledger account if you wish to use department breakup eg Sales Revenue Admin, Sales Revenue Stationary etc.
You would firstly create the general ledger chart of account for each department and then assign these accounts to the appropriate product category levels.
You may also want to break up the cost of goods area by the same department.
Note : Readysell does not recommend a department general ledger chart of accounts as you can run reports by Product Category within Readysell.
General Ledger Account breakups within the product category:
The accounting effect of when a stock item is sold, the cost of the product is removed from Stock on Hand and put to Cost of Goods.
Therefore this means the two accounts should be different if the product is being tracked for stock purposes as opposed to non-stock purposes.
Cost of Goods Sold: should be a profit & loss account
Sold Stock: should be a stock on hand account
Purchased Stock should be the same as Sold Stock for stock controlled products, to avoid a discrepancy between recording the purchase (increase in stock) and recording the sale (decrease in stock) unless the product is a non-stock product and a type of service or expense. EG Freight Inwards, the purchase general ledger account would be the general ledger account for Freight Inwards.
The accounting effect of when a stock item is received, the cost of the product is removed from Accrued Stock (Credit) on hand and put to the Stock on Hand (debit).
When the purchase receipt is then Invoiced, the accrued stock on hand figure is negated (debit) resulting in a nil effect.
For a non-stock product, (expense or service type eg freight inwards), the accrued stock and stock on hand is using the same general ledger account and this is because normally there is no cost on a non-stock product.
Procedure in respect to creating sub-department chart of accounts
Highlight the main general ledger account eg Sales Revenue 61010
Click on COPY
Change the Account-id to be 61012 and description to be Sales Revenue Header
Click On Save
Go Back to 61010 and rename it to eg 61010FUR and change the description to be Sales Revenue - Furniture.
Ensure that 61010FUR on the settings tab, that the P&L Parent and Bal Sheet Parent account are both changed to point to 61012
Click on SAVE
Go back to general ledger account 61012 and change that to be 61010 and Click on Save
Check that 61010FUR on the settings tab, that the P&L Parent and Bal Sheet Parent account are both now 61010
Repeat steps by highlight the sub-department gl account 61010FUR and name it eg 61010ADMIN with a description of Sales Revenue - Administration etc
Continue until you have created the appropriate sub-departments in the areas of the chart required.
The task may need to be run to refresh general ledger balances and/or re-dissect if you have created new gl accounts and assigned them to categories
Speak to Readysell
Every category must have a category type of:
Stock control products, which means every product in that category is a product you can stock
Non-stock control products, which means every product in that category is a non-stock item, a service, like freight, service fee etc.
To create a non-stock product, like freight, create the product then when entering a category on the product, select a non-stock category. The simplest way to do this is to copy an existing non-stock product then change the details. Something like "RESTOCK" should exist on your system and can be copied to a new non-stock product.
To create a stocked product, make sure the category you select for the product has a category type of "stock control products"
The non-stock products that come with the system include freight in freight out and many other common non-stock items. Just add the non-stock product you want to a sale and enter a quantity and price to add a non-stock fee to a sale.
Procedure once the General Ledger Accounts are set up:
The first step is to set up the Product Categories.
The second step for Non-Stock Products is to determine the Costing method. This affects GP% and Margin on Sales Invoicing
The third step is to put products into the correct product categories.
The fourth step is to ensure that the correct General Ledger account codes are correct on each Parent category. If you wish to break up the general ledger further you can assign a different General Ledger account to the child. It works like Parent/Child scenario.
There are a few base categories
Catalogue Products
Store Products
Uncategorised Product
Non-Stock Product
Products that are added to your site and are not part of the standard product range for the group should be in the Store Products categories.
On the Navigation panel click on 'Administration' and then click on 'Product Categories'