Chapter 3: Working with Project Transactions

CHAPTER 3: WORKING WITH PROJECT

TRANSACTIONS
Objectives
The objectives are:

• List the four project transaction types.

• Define categories and category groups.
• Set up cost prices, sales prices, and price groups.
• Define line properties.
• Define project hour transactions.
• Enter project hour transactions.
• Enter project expense transactions.
• Enter project expense transactions.
• Charge an invoice journal and use the invoice register.
• Create free text invoices.
• Define project item transactions.
• Enter project item transactions.
• Define the item requirements form.
• Define purchase orders.
• Define purchase requisitions.
• Define production orders.
• Define sales orders.
• Define and enter beginning balances.
• Review project transactions.
• Adjust project transactions.
• Set up the journals.
• Set up journal approval.
• Set up journal descriptions.
• Set up ledger posting.
• Set up posting by project group or category.

Introduction
Several transaction types are managed and processed in the Microsoft Dynamics®
AX Project management and accounting module. Many processes for
configuring, entering, and adjusting transactions are available.

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Transaction Types
After a project is created, transactions are entered through journals or project-
related business documents. The following transaction types are supported in the
Project management and accounting module.

Transaction type Example

Hours Consulting, installation
Expenses Plane tickets, hotel accommodations, vendor services
Fee Surcharges
Item Products delivered as part of the project

In addition to these transactions, on-account transactions represent pre-payments

for a time and materials project or scheduled payments for fixed-price projects.
On-account transactions are covered in “Invoicing Projects.”

The following is true for all transaction types:

• The system searches for sales and cost prices and applies them as
default to the transaction. The user can override prices in the journal.
• The sales tax group is taken from the project or project contract. For
non-item transactions, the item sales tax is derived from the specified
project category.
• The line property indicates whether the registered transaction can be
invoiced or not. A line property that can be charged is only relevant
on time and material projects.

The following is true for some transaction types:

• Hour, expense, and fee transactions can use validation functionality.

To learn more about the validation functionality refer to the
Advanced Project Management and Accounting course.
• In addition to being managed in the project ledger, project
transactions are usually summarized by posting to the general ledger.
The ledger posting setup is discussed later in this chapter.

Distributions and Subledger Journals

The following business documents support the creation of project transactions
through project distributions and the subledger journal framework:

• Free text invoice

• Purchase order
• Purchase requisition

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• Expense report
• Vendor invoice

Before you post a transaction, you can view the full accounting entry of the
transaction. This includes debits and credits and project details, to verify that the
transaction is being posted correctly. This view of the full accounting entry is
called a subledger journal.

You cannot edit subledger journals directly – you do this through distributions.
Distributions display only one side of the accounting entry - the debit or the
credit.

Categories and Category Groups

The Project management and accounting module offers an easy method for
categorizing revenue and expenses on projects. This provides detailed reporting
and analysis as well as drives posting to the general ledger. By categorizing
expenses and revenues separately from the general ledger, project managers can
get additional detail on project performance.

The following diagram illustrates the correlation between shared categories,

project categories, category groups, and transaction types:

FIGURE 3.1 CATEGORY BREAKDOWN DIAGRAM

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Shared Categories
To make it easier for companies to categorize expenditures, categories are shared
among the Expense management, Production control, and Project management
and accounting modules. In addition, categories are shared between legal entities.

To create a new category for use with project transactions, you must first create it
as a shared category:

1. Open Project management and accounting > Setup >

Categories > Shared Categories.
2. Click New.
3. Enter a Category ID and Category name.
4. Click Can be used in Project.
5. Click Close.

FIGURE 3.2 SHARED CATEGORIES FORM

Category Groups
You can use category groups to share properties (primarily posting profiles)
between related categories. There must be at least one category group for each
transaction type and each project category is assigned a group.

Together, the project groups, project categories, and category groups define the
posting specifications in the Project management and accounting module.

In addition, line property defaults can also be defined for category groups.

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To open the Category groups form, open Project management and

accounting > Setup > Categories > Category groups.

FIGURE 3.3 CATEGORY GROUPS FORM

Project Categories
As soon as you have defined a shared category and category group, you can
configure a category for use within Project management and accounting
transactions.

To open the Project categories form, open Project management and

accounting > Setup > Categories > Project categories.

FIGURE 3.4 PROJECT CATEGORIES FORM

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As project categories are assigned to a single group, they will be associated with
the same transaction type as the category group.

When you try to enter a project category on a transaction line, the category
selection will be limited to the categories that are set up and linked to this
transaction type. For example, only expense categories are available when an
expense transaction is entered.

To create a category:

1. Open Project management and accounting > Setup > Category >
Project categories.
2. Press CTRL+N to create a new project category.
3. Select a previously created shared category.
4. Select a Category group.

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Lab 3.1 - Create a New Category Group and Category

In this lab, you will create a new hour category and track training hours.

Scenario

Global Trade and Manufacturing needs better tracking of the internal training of
consultants and service technicians. For this the company needs to create a new
hour category to track training hours. The hours need to post to the account
540100.

Challenge Yourself!
Create the category group and shared category before the project category.

Need a Little Help?

Create the Category group and shared category before the project category.

Step by Step

1. Open Project management and accounting > Setup >

Categories > Shared categories.
2. Click New.
3. Type "TRNING" for Category ID and "Training" for Category
name.
4. Select Can be used in Project.
5. Click Close.
6. Open Project management and accounting > Setup >
Categories > Category groups.
7. Click New.
8. Type "Training" for Category groups, and select Hour for
Transaction type.
9. In the Cost accounts tab, select project 540100 from the Cost list.
10. Click Close.
11. Open Project management and accounting > Setup >
Categories > Project categories.
12. Click New.
13. Select TRNING in the Category ID list.
14. In the Project tab, select Training for Category group.
15. Click Close.

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Project Pricing
Project transactions include a cost price, a sales price or both. The cost price is
the price per unit that is charged to the project. From a cost perspective, it is not
important if the transaction will be invoiced to a customer or not.

If a customer will be invoiced for transactions, a sales price is specified per unit.
Sales prices are not used for fixed-price projects or internal projects.

Cost and sales prices can be specified generically at the category or employee
level, or more specifically on a project. Specifying them generically helps
standardize pricing, removing the need for users to determine cost and sales price
at the time of transaction entry.

NOTE: For project transactions of type item, the cost and sales price of items
are determined by the properties of the released product and the applicable trade
agreements. The sales price of an item can also be updated in the project item
journal line.

The best place to set up pricing depends on the transaction type. For example,
when you post hours, the best practice is to set up the cost price on the employee
record and set up the sales price or billing rate on the project. If a sales price is
set up on the employee record, it becomes the default billing rate for all hour
transactions. It can be changed at the time of transaction entry. However, unless
there are standard bill rates for all projects, this could lead to data entry errors.

You can also set up pricing to be date driven; meaning if an employee's salary or
bill rate will increase on a certain date, you can set up the increase in advance to
make sure that the updated price is used.

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Setting Up Cost Prices

To set up cost prices that affect hour and expense consumption, use the Cost
price - hour or Cost price - expense forms. To access this open Project
management and accounting > Setup > Prices > Cost price - hour.

FIGURE 3.5 COST-PRICE HOUR FORM

To reach the Cost-price form, open Project management and accounting >
Setup > Prices> Cost price - hour.

When you set up cost pricing, the system only requires that you complete the
date field. If you fill in no other fields, a standard cost price is set up for all
employees on all projects using all categories. With this method, every hour or
expense entered has the same cost.

Because most companies have difference costs, specify at least one of the
following:

• A category
• A worker
• A project

Build cost prices by combining one, two, or all these factors to allow for the
setup of differentiated pricing.

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NOTE: The cost price can also be set up on the worker record. Because salary is
carried at the employee level, this is usually where cost is set up. The
functionality is the same and can be customized to the date, category and, or
project.

Setting Up Sales Prices

Set up for sales prices that affect hour consumption, expenses, fees, and
subscriptions are very similar. For example, the following figure defines the
default sales prices for hour transactions.

FIGURE 3.6 SALES PRICE - HOUR FORM

To open the Sales price –hour form, open Project management and
accounting>Setup >Prices>Sales price - hour.

The following options are available for setup:

• Category
• Worker
• Project ID
• Price group

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• Sales currency
• Sales price model (not available for fee and subscription
transactions)
• Sales price

As in the setup of cost prices, the date is the only required field. When you set up
a sales price you will need to select which sales price model to use. The model
controls how much, if any, markup to charge over the cost price.

You can combine any of the following options to allow for different sales prices.
The sales price model offers additional choices about how the sales price is
calculated:

Sales price model Sales price calculation

Qty Equal to Pricing field
Contribution ratio (100 * Cost price) / (100-Pricing)
Charges pct. Cost price * (100 + Pricing)/100
Charges amount Cost price + Pricing

The Qty sales price model is the default option.

You can also set up a sales price (or bill rate) on the individual project enabling
workers or categories to have different bill rates across projects.

Setting Up Price Groups

Similar to the user of trade agreements for sales orders, price groups can be
assigned to projects and project contracts and can be used to drive sales prices of
project transactions. For examples, you might define a price group for frequent
customers and another for one-time customers.

Create price groups to manage the sales pricing of projects as follows:

1. Open Inventory and warehouse management > Setup >

Price/discount > Customer price/discount groups.
2. Use the Show filter to display the form by Price group.
3. Click New.
4. Enter Price groups and a Name for the price group.

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Lab 3.2 - Set Up Prices for a New Contract

Scenario

Contoso Ltd has a time and material service contract with a customer.

• It is set up as project number 10001.

• The company currently uses both trained service technicians and
apprentices to work on this job.
• Any travel time on this job is charged at cost plus 15%.

The employees who work on this job are as follows.

Name Cost price Sales price

Lars Giusti 43.75 60
Shannon Dascher 37.75 60
Tricia Fejfar 52.75 100
Ken Ewert 75.45 120

Challenge Yourself
Set up the cost and sales prices for the new project.

Need a Little Help?

From project 10001, click the Plan tab on the Action Pane, and select Hours
from the Cost prices group.

Step by Step

1. Open Project management and accounting > Common >

Projects > All projects.
2. Select project 10001.
3. On the Action Pane, select the Plan tab. Then in the Cost prices
group, click Hours.
4. Click New.
5. Enter a valid Effective date, Worker, and Cost price. Repeat for
each employee.
6. Click Close.
7. On the Action Pane, on the Plan tab in the Sales prices group, click
Hours.

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8. Click New.
9. Enter a valid Effective date, Worker, and pricing. Repeat for each
employee.

NOTE: Make sure that the Sales price model is Qty.

10. Click Close.

11. On the Action Pane, on the Plan tab in the Sales prices group, click
Expenses.
12. Click New.
13. Enter a valid Effective date, and select Travel for Category.
14. Select Charges percentage for Sales price model and enter “15” for
Pricing.
15. Click Close.

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Line Properties
Together with project categories and pricing, line properties are important for
project transactions. The line property controls whether any of the following
occur:

• An additional cost percentage is applied to the transaction.

• An additional sales percentage is applied to the transaction - applies
only for time and material projects.
• A transaction with this line property is chargeable to a customer.
• The sales value of a transaction is accrued at the time it is posted on
time and material projects.
• The cost is capitalized to balance accounts when transactions with
this line property are posted. This applies to time and material
projects, fixed-price projects, investment projects, and internal
projects.

Line Property Setup

The line properties are set up from in the Line properties form. Open Project
management and accounting > Setup > Line properties > Line properties.

FIGURE 3.7 LINE PROPERTIES FORM

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The following fields are available on the Line properties form.

Field Description
Chargeable Ensures transactions with this line property are included
when an invoice proposal is created.
Because internal projects are not invoiced to a customer and
fixed-price projects are processed differently than time and
material projects, this field will be ignored for transactions on
these project types.
Accrue Determines whether the sales value of a transaction on a time
revenue and material project accrues when the transaction is posted.
Covered in the Project Management and Accounting
Advanced course.
Capitalize Determines whether costs can be capitalized to balance
costs accounts when transactions are posted.
Additional Although cost prices may be set up for the different
cost categories or a cost price generally, provides an option for a
percentage line property that uses additional cost percentage.
Additional Controls the increase of some different transaction sales
sales prices.
percentage For example, if a line property is set up with an additional
sales percentage of 100%, this option doubles the initial sales
price and could be an easy method to charge for overtime.
Print zero Prints transactions with a sales price of zero on the invoice.
sales price on
invoice
Print zero Prints transactions with a sales price of zero on the project
sales price on quotation.
quotation
Efficient Counts transactions with this line property as efficient for
hours utilization calculations.
Add to norm Counts transactions with this line property as overtime for
hours - billable hours for utilization calculations.
billable rate
Add to norm Counts transactions with this line property as overtime for
hours - efficient hours for utilization calculations.
efficient rate

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Project/Group Line Properties

In the Project/group line properties form, an overview of all line property setup
is displayed. It can also be specified where the line properties should apply.
Open Project management and accounting > Setup > Line properties >
Project/group line properties.

FIGURE 3.8 PROJECT/GROUP LINE PROPERTIES FORM

To open the Project/group line properties form, open Project management

and accounting>Setup>Line properties>Project/group line properties.

The setup is designed as Table/Group/All relations. This means the line property
used when a transaction is entered in a journal is chosen based on a search for the
most specific criterion.

The search direction for a line property can be set up on the project group or the
project itself.

If the line property is set up on both the group and the project, the project line
property always overrides the line property of the project group.

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The system searches for a combination of a specific project and a specific

category. If this combination is not found, the search continues until the least
specific combination (all/all) is found.

Line property can also be set up on the following:

• Individual projects
• Project groups
• Categories
• Category groups

Hour Transactions
Remember the following when you work with hour transactions:

• Hours can be entered on all types of projects.

• Hours are associated with a worker, either employees or contractors.
• Hours can be entered using hour journals or timesheets. Timesheets
are covered in a separate chapter.

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The following figure displays how hour transactions are entered and what values
are posted to ledger.

FIGURE 3.9 HOUR TRANSACTIONS

Hours Journal
The basic information entered for hour registration on a project includes the
following:

• The project to which the hour costs should be allocated.

• The date the hour costs occurred.
• The name of the person who initiated the hour costs.
• The type of hour costs to be allocated.
• The amount to be posted, and if invoiced to a customer, at what price
and whether sales tax is applied.

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To open the hour journal form, open Project management and accounting >
Journals > Hour.

FIGURE 3.10 HOUR JOURNAL FORM

Although this journal is exclusive to the Project management and accounting

module it still contains the same standard journal functionality.

Copy an Existing Journal

Journals that have been created can be copied to a new journal even if they are
already posted. Once the journal is copied, the journal lines can be altered.

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This functionality can also be used to reverse a posted journal. When you copy a
journal, the Reverse check box copies the journal with the lines reversed
allowing for easy reversal of a posted journal.

FIGURE 3.11 COPY LINES TO A NEW JOURNAL FORM

As a result, the lines match the original journal exactly, and they can be modified
before posting. There are benefits and drawbacks to this:

• This method works well if time is entered the same way every week.
• It is easy to forget to change the information before posting the
journal if multiple projects are worked on at different times.

Create New Hours Journal

To create a new hours journal, open Project management and accounting >
Journals > Hour and then click New. Click Lines to create a new journal.

Default Values for Hours Journal

If hour consumption is entered daily and the hour consumption is primarily
related to the same project, an employee can enter default information for the
Default values tab of the hour journal.

This option lets you to set default values for the following:

• Project date
• Project reference

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• Project category
• Employee reference
• A transaction text

Therefore, when a new journal line is created, the values in the Default values
tab are transferred automatically, and they can be either accepted or changed. To
open the window, open Project management and accounting > Journals >
Hour and then click the Default values tab.

FIGURE 3.12 DEFAULT VALUES TAB JOURNAL FORM

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Enter Hour Journal Lines

Enter the journal lines using the Journal Lines for Hours form by opening
Project management and accounting > Journals > Hour. On the menu bar,
click Lines.

FIGURE 3.13 JOURNAL LINES FOR HOURS FORM

After you have entered all transactions, validate and post the journal unless there
is a journal approval procedure.

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Expense Transactions
Expenses can be entered on all types of projects. The following diagram displays
how expenses can be entered and which project values post to the ledger.

FIGURE 3.14 PROJECT EXPENSE TRANSACTIONS

Forms used to enter project expense transactions are found in the following
locations:

Form Path
Expense journal Projects > Journals > Expense journal
Expense report Enterprise Portal > Journals > Expense journal
General journal General ledger > Journals > General journal
Invoice journal or Invoice Accounts payable > Journals > Invoices >
register Invoice journal
Accounts payable > Journals > Invoices>
Invoice register
Vendor invoice Accounts payable > Common >
Vendor invoices > All vendor invoices

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The information that is required when entering an expense transaction on a

project includes the following:

• The date the expenses are registered

• The project to which the expenses are to be allocated
• The name of the individual who initiated the expenses
• The types of expenses to be allocated
• The cost price amount to be posted
• The ledger account against which the expenses are to be settled.

If the expenses are to be invoiced to a customer, the amount to be invoiced

includes sales currency and sales tax.

After validating the transactions, post the journal unless a journal approval
procedure is set up to control the expenses posting. If so, approve the journal
before invoicing.

Expense Journals
To access the Expense journal form, open Project management and account >
Common > Projects > All projects. Select a project, and then on the Action
Pane, select the Project tab. In the Journals group, click Expense.

FIGURE 3.15 EXPENSE JOURNAL FORM

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Procedure: Post an Expense Journal

Follow these steps to post an expense journal.

1. Open Project management and account > Common > Projects >
All projects.
2. Select a project.
3. On the Action Pane, on the Project tab, in the Journals group, click
Expense.
4. Click Lines.
5. Complete the Project, Category, Line Property, and Offset account
type. Only categories with the transaction type expense are available
in an expense journal. Additionally, if a line property is set up on the
chosen project the system uses the project default values but these
can be changed.
6. Enter a worker on each line to better track project costs, and use the
transaction text to further segment the expense.
7. Enter the Cost price, Quantity and Sales price. If there is a Sales
price set up on the chosen project, the system uses the project default
values. But these can be changed. Refer to the discussion about sales
price set up for more information.
8. Also, use the expense journal to post project costs across companies.

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General Journal Project Expense Entries

The general journal in the general ledger (GL) module can also be used to enter
project expense transactions. To access the General journal form, open General
ledger > Journals > General journal. Then click Lines.

FIGURE 3.16 GENERAL JOURNAL PROJECT EXPENSE ENTRY

Procedure: General Journal Entry

Follow these steps for a general journal to reach a project.

1. Open Project management and account > Common > Projects >
All projects.
2. Select a project.
3. On the Action Pane, select the Project tab. Then in the Journals
group, click Expense.
4. Click Lines.
5. Select Project as the Account type.
6. Enter the Line property, Category, Worker, Cost price, and Sales
price on the Project tab before posting the journal.
7. Click Post.

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Invoice Journals and Invoice Registers

Two different options exist for registering a vendor invoice and allocating the
expenses to a project.

• Invoice journal - Use the invoice journal in accounts payable if you

know the exact project to which the invoice will be charged.
• Invoice register - Use the invoice register in accounts payable when
you are not sure to which project to allocate the expenses when
receiving the vendor invoice.

Procedure: Charging an Invoice Journal in Accounts

Payable
Follow these steps to charge an invoice journal to accounts payable.

1. Open Accounts payable > Journals > Invoices > Invoice journal.
2. Click Lines for the specific invoice journal.
3. On the Overview tab, enter “Vendor” as the account type, select
invoice, and enter the invoice amount on the debit or credit column.
4. Select an offset account type of Project.
5. Select the project to which expenses will be charged for the offset
account.
6. Click Post.

Procedure: Using the Invoice Register

Use journal forms to create and validate journals and journal lines. You can then
post the lines in the Journal voucher form or in the Journal form.

Follow these steps to use the invoice register.

1. Open General ledger > Journals > General journal.

2. Click New to create a line.
3. Select a journal name in the Name field.
4. Enter information in other fields as appropriate. Default field
information from the Journal names form is displayed.
5. Click Lines to open the Journal voucher form. Some fields might
display default values from the Journal form.
6. In the first line on the Overview tab, enter values in the relevant
fields. The available fields vary, depending on which journal you are
using. They may include the following:
o Account type
o Account
o Description

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o Debit or Credit, as appropriate

o Offset account type
o Offset account (You can use two or more lines to specify more
than one offset account for the same voucher)

7. Click New to create another line, and then enter information about
the next voucher.
8. After you enter all the lines, click Validate, and select to validate
that all the lines or the selected lines are ready for posting. For
example, in the general journal Journal voucher form, you can
select Validate the general journal or Validates the current
voucher.

You can also validate all the lines in the journal in the Journal form.

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Lab 3.3 - Enter an Invoice Journal

In this lab, you will enter an expense transaction through the Accounts payable
Invoice journal.

Scenario

Contoso Ltd has a freight bill to be charged to project 10001, Contoso Retail Los
Angeles. The invoice is from vendor 5002 Northwind Traders. It is invoice
number 40332 for 500 U.S. Dollars (USD).

Challenge Yourself!
Enter the invoice as a project transaction through an accounts payable invoice
journal.

Need a Little Help?

Use the transport category when entering the project transaction.

Step by Step

1. Open Accounts payable > Journals > Invoices > Invoice journal.
2. Click New.
3. Select "APInv" for Name.
4. Click Lines.
5. Select Vendor for Account type. Then select 5002 for Account,
40332 as the Invoice, and enter “500” for Credit.
6. On the General tab in the Offset account group, change the Offset
account type to Project.
7. Select 10001 for the Offset account column.
8. Click the Project tab.
9. Change Category to Transport.
10. Click Post and select Post.

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Free Text Invoices

A free text invoice is an invoice that is not attached to a sales order. A free text
invoice contains a header and one or more lines for items or services that are not
tracked in inventory. Use a free text invoice for sales that do not require a sales
order, packing slip, and customer invoice. For example, you can use a free text
invoice for a consulting fee or services fee, or for a miscellaneous fee for an
event reimbursement.

Procedure: Creating a Free Text Invoice

Follow these steps to create a simple free text invoice.

1. Open Accounts receivable > Common > Free text invoices > All
free text invoices.
2. On the Action Pane, click Free text invoice to open the Free text
invoice form.
3. On the Free text invoice header tab, select the customer account.
The default information for the customer account is displayed.
4. Select a billing classification.
5. In the Invoice lines grid, enter a description, select the main account,
and enter the quantity and unit price for the invoice line.
6. On the Line details tab, enter any additional information.
7. To save your changes without posting the invoice, click Close.

Information about correct use of a free text invoice is included in the Financials
course.

Item Transactions
Items can be sold from or purchased for a project, or only be reserved for the
project. There are several different methods to process item consumption in
projects.

• Entered in the item consumption journal

• Purchased from an external vendor
• Required directly from current inventory
• Sold to a customer
• Produced through the production module

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The following figure displays which project types support the different item-
handling options and when the item consumption has a financial effect on the
project.

FIGURE 3.17 ITEM HANDLING FLOWCHART

The Item Consumption diagram displays the basic information entered for item
consumption from the item consumption journal, the item requirements journal,
or a sales order to have a financial effect on a project.

FIGURE 3.18 ITEM CONSUMPTION DIAGRAM

The information that is required for item consumption includes the following:

• The date the item is to be consumed

• The project to which item costs are to be allocated
• The type of item together with item characteristics and category

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• Unit price, cost price, and quantity required

• Sales price, sales currency, and sales tax codes if the item
consumption is invoiced to a customer. The line property must be
chargeable.

NOTE: The item cost price per unit cannot be directly adjusted in the journals.
The item is consumed at the average cost price and updated correctly based on
the inventory model (last in, first out (LIFO), first in first out (FIFO), or
weighted average) when the inventory recalculation or closing is finished.

Consumption Items
Item consumption on a project can be done from the company's inventory or you
can purchase them from an external vendor.

• Enter items ordered from the company's inventory as an item

requirement. A partial delivery is available if ordering items from the
item requirements window; that lets you postpone consumption of
part of the items until the items are required.
• Enter items ordered from an external vendor as a purchase order in
the Purchase order window.

Common Item Characteristics

There are common functions available for processing items regardless of the
method chosen for item processing. The different methods of item processing all
derive from the issuing of items, not the processing of purchase orders.

• Reserve an item directly from the journals or a sales order.

• Mark lots for an item directly from the journals or a sales order.
• Register and select items from the inventory directly from the
journals or sales order.
• Specify all types of inventory dimensions directly in the journals or
in the sales order.

To learn more about how to sell and purchase items refer to the Supply Chain
Foundation in Microsoft Dynamics AX 2012 course.

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Project Item Handling Methods Overview

The following provides an overview of project item handling methods.

Method Path Purpose Consumption

of items
Item journal Enter Fast method for entering Item
transactions in and maintaining item transactions
the Inventory records. If, for example, consumed when
journal an item requirement is the journal is
window. entered based on a posted.
Select printed list, the
Journals and inventory journal can be
Item applied.
consumption.
Item Enter For entry of items not to Item
requirement transactions be consumed transactions
in the Item immediately. Lets users consumed when
name keep track of what the packing slip
window. number of items within is updated.
Select a one item requirement
project in the record is consumed.
Projects
window. From
Item task,
click Item
requirements
.
Purchase Enter the Purchase orders can be Depends on how
order transactions in entered as follows: the purchase
three locations 1) Item record entered as order is entered.
depending on a regular purchase order.
the purchase 2) Purchase order
method. created from a sales
order.
3) Purchase order
created from an item
requirement.
Production Enter project Allows for automatic Depends on the
order production consumption of item
order. From production order items. consumption
Item task, method set on
click the Project
Production management
order. and accounting
parameters
form.

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Project Essentials in Microsoft Dynamics® AX 2012

Method Path Purpose Consumption

of items
Sales order Enter Enter a sales transaction Item
transactions in directly on a time and transactions
the Sales material project. consumed when
order form. the customer
Select a time invoice is
and material posted.
project in the
Projects
window. From
Item, click
Sales order.

Item Journals
The Item journal form is available for all project types. Use it to perform the
following:

• Enter items directly in an inventory journal

• Financially allocate the item costs when you post the journal.

To open the item consumption journal, open Project management and

accounting > Journals > Item. Create a new item journal by clicking New and
then click Lines.

FIGURE 3.19 JOURNAL LINES, INVENTORY

The use of this journal does not allow for partial delivery updates. Therefore, if a
large quantity of items is consumed when you run a project, the full cost amount
for all items is financially updated on the project as soon as the journal is posted,
and a partial number of items consumed cannot be posted.

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Item Requirements
Use the Item requirements form to perform the following:

• Enter items directly in an inventory journal

• Financially allocate the item costs when the items are partially or
fully delivered

Using the Item requirements form does not mean the item consumption must be
invoiced to a customer. It can be an item the company has to cover to fulfill the
project contract.

To open this window, open Project management and accounting > Common >
Item tasks > Item requirements.

FIGURE 3.20 ITEM REQUIREMENTS

On the Project tab enter the:

• Category
• Line property
• Sales price if it is billable to the customer
• Any sales tax information needed

NOTE: The category can be set up on the item allowing it to default in when you
add the item to the journal.

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Purchase Orders
Purchase orders can be created in three different locations in the Project
management and accounting module to maintain a direct reference to the
originating project.

Open Project management and accounting > Common > Item tasks >
Purchase orders.

From Item task, click the Project purchase orders option to open the Purchase
order (PO) form. The difference between entering a PO from the project
management and accounting module and entering it from the accounts payable
module is that in accounts payable, a project number cannot be selected. In the
project management and accounting module, the project number is a required
field.

After entering the POs, a review of the POs in Accounts payable shows the
project numbers are filled in. This makes it easy to view which POs relate to
project expenses. To review POs, open Accounts payable > Common >
Purchase orders > All purchase orders.

FIGURE 3.21 PROJECT PURCHASE ORDERS

Item costs are consumed when the PO is invoice updated from accounts payable.
There is a reference to the project on the Overview tab in the purchase order

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Purchase Requisitions
Purchase requisitions do not result in project transactions directly. However, the
project associated with a purchase requisition will be included when it is used to
create a purchase order.

Open Project management and accounting > Common > Item tasks >
Purchase requisitions.

To create a new purchase requisition, click Purchase requisition, enter the name
of the purchase requisition in the dialog box, select a project, and then click OK.

To open an existing purchase requisition, double-click the line item for the
purchase requisition on the Purchase requisitions prepared by me list page.

Use this form to create or modify a purchase requisition, and then submit the
purchase requisition for review. You can create purchase requisitions for multiple
users, in multiple legal entities, or for organizations. You can also copy an
existing purchase requisition and purchase requisition lines to create a new
purchase requisition. You can approve, reject, or complete purchase requisitions
that are assigned to you.

Production Orders
If an item needs to be produced through the production module and then charged
to the project, a project production order can be created from the project. Using a
project production order, costs incurred in the production process will be charged
to the project. There are two methods to charge production costs to a project:

• Finished item- Once items are reported as finished on the

production order, the costs are charged to the project as item
transactions.
• Consumed - Costs are charged to a project as they are incurred on
production orders as item transactions for the raw materials
consumed by the production order and as hour transactions for hours
worked on the production order.

To create a production order, open Project management and accounting >

Common > Item tasks > Project production orders. Any order created will be
automatically tied to the project, and the project number will appear in the project
field.

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Sales Orders
To process items sold using the standard sales order functionality through a
project, you can use a project sales order. With the project sales order, the
standard sales order pick list and packing slip functionality are available, but
invoicing must be done through a project.

Open Project management and accounting > Common > Item tasks > Project
sales orders.

NOTE: This option is only available when you use a time and material project
because there can be no line item invoiced on a fixed-price or internal project.

When you click Sales order from Item, the system opens the Sales order (SO)
form that is then used typically. After entering the SO, a review of the SOs in
accounts receivable shows the project numbers are filled in and that makes it
easy to view which SOs relate to the project.

FIGURE 3.22 PROJECT SALES ORDERS

The item costs are consumed when the project invoice is updated and the
attached sales orders are included.

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Lab 3.4 - Create a Project Production Order

In this lab, you will create a project production order.

Scenario

Contoso Ltd has to produce inventory for one of its projects, 20001 School of
Fine Art. Item 1101 has to be created, and 10 must be produced. Costs should be
charged to the project as the items are finished in the production process.

Challenge Yourself!
Create the project production order.

Need a Little Help?

Make sure that the production posting model is set to finished item.

Step by Step

1. Open Project management and accounting > Common >

Projects > All projects.
2. Double-click project 20001 School of Fine Art.
3. On the Action Pane, select the Manage tab. Then in the New group,
click Item tasks and then click Production order.
4. For Item number select 1101, for Quantity enter "10".
5. Click Create.

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Beginning Balances
By entering beginning balance transactions, you can transfer projects to
Microsoft Dynamics AX without affecting the general ledger. For example, if
you have been tracking a project offline or in another program, you can migrate
the project to Microsoft Dynamics AX, specify a beginning balance, and then
continue to track the project information. You can also use a beginning balance
journal if you have been recording project costs and revenues in Microsoft
Dynamics AX, but have not recorded details in Project management and
accounting and now want to track project details.

1. Open Project management and accounting > Journals >

Beginning balance.
2. Click New.
3. On the Overview tab in the lower pane, in the Name field, select a
journal name that is a beginning type.
4. Click Lines.
5. In the Journal lines for beginning balances form, click Add, fill in
the relevant transactions, fees, or on-account fields, and then click
OK.
6. To post the journal, click Post in the Beginning balance journal
form.

If you created the beginning balance from the Projects form, you can view a
transaction form that shows the line for the beginning balance transaction. In the
Projects form, on the Action Pane, select the Maintain tab. Then in the New
group, click Transactions, and select the transaction type that you selected when
you created lines for the beginning balance journal.

NOTE: Most of the information for the journal is inherited from the journal
name. However, you can enter other settings for journal description, voucher and
posting settings, and blocking.

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Review Project Transactions

There are several forms that can be used to review the transactions related to a
project. The following topics introduce some of these forms.

View Pending Transactions

To access the list of transactions that have not been posted to the project
subledger, open Project management and account > Common > Projects> All
projects. Select a project, and then on the Action Pane, select the Manage tab. In
the Related Information group, click Pending transactions.

FIGURE 3.23 PENDING TRANSACTIONS LIST

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Project Essentials in Microsoft Dynamics® AX 2012

View Posted Transactions

To view all posted transactions for all projects, open Project management and
accounting > Common > Transactions > Posted project transactions. This
screen provides an overview of all project transactions that have been posted
regardless of transaction type.

FIGURE 3.24 POSTED PROJECT TRANSACTIONS

To view project invoices for a selected transaction, click Invoice lines in the
View group on the Action Pane. In this list you can see the following:

• Project-specific invoices and project-specific invoice proposals from

the project view
• All projects and open invoice proposals

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View Ledger Updates

To display the exact general ledger postings, view the transactions directly.

To view ledger updates, open Project management and accounting >

Common >Transactions > Posted project transactions. On the Action Pane,
select the Project transactions tab. Then in the View group, click View ledger
updates.

FIGURE 3.25 LEDGER UPDATES FORM

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Project Essentials in Microsoft Dynamics® AX 2012

Lab 3.5 - View Project Transactions

In this lab, you will view a list of project transactions.

Scenario

The project manager for project 20002 - Cheetah Concert Hall wants to see all
transactions for the project in one screen.

Challenge Yourself
Find all the transactions for project 20002 by using the Posted project
transactions page.

Need a Little Help?

Use the search function at the top of the page to limit the transactions to only one
project.

Step by Step

1. Open Project management and accounting > Common >

Transactions > Posted project transactions.
2. Enter "20002" in the Project ID filter.
3. Enter "4/1/2008" as the Start date.

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Adjusting Transactions
If posted transactions are registered incorrectly, an adjustment procedure can be
performed on all project types to adjust these transactions. Recognize there are
some limitations on when to adjust posted transactions.

Project type Adjustment only available until

Internal No restrictions
Time and Transactions are included in an invoice proposal. (Cancel
material invoice proposal to enable adjustment on transactions.)
Fixed-price Transactions included in an estimate.

NOTE: On fixed-price projects, adjusting the project sales tax group on hour,
item, and expense transactions will not have an effect because these transactions
do not impact the invoice amount.

The following figure shows the overall procedure from parameter to posting.

FIGURE 3.26 OVERALL ADJUSTMENT PROCEDURE

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Project Essentials in Microsoft Dynamics® AX 2012

The following table provides an overview of what field values can be adjusted
for each of the four transaction types.

Adjustment field Hour Item Expense Fee

Project no. Yes Yes Yes Yes
Category Yes** Yes** Yes** Yes**
Line property Yes Yes Yes Yes
Activity Yes Yes No No
Worker No No Yes No
Item no. No No No No
Cost price Yes No No No
Sales price Yes Yes Yes Yes
Sales currency Yes Yes Yes Yes
Quantity Yes* Yes* Yes* No
Transaction texts Yes Yes Yes Yes
Item tax sales group Yes Yes Yes Yes
Tax group Yes Yes Yes Yes
Ledger account No Yes No No
Dimensions Yes Yes Yes Yes

*Only when split into more lines adding up to the quantity of the transaction to
be adjusted.

**Only to a category of the same type.

When adjusting any transactions, decide whether to enable the Always create
adjustment transactions parameter. Take the following steps when you create
adjustment transactions:

1. Select the adjustment transactions.

2. Select Adjust and split the original transaction lines.
3. Enter the new values.
4. Update new values, and check new transactions.
5. Post the new values of the adjusted transaction to the ledger.

Adjustment Parameters
When adjustments are created on transactions already posted, the original ledger
transaction is reversed and a new one is created. This creates more project
transactions and, if the only adjustment made is to correct the transaction text
printed on the invoice to the customer, the process is tedious to reverse one
transaction and create a new transaction.

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For this purpose, use the Always create adjustment transactions parameter.
This is a checkbox located on the General tab of the Project management and
accounting parameters form.

The system reverses the original transaction and creates a new transaction when
any adjusted transaction is posted and when the parameter is selected. If the
parameter is not selected, the system only reverses the original transaction for
certain types of adjustments according to the following table.

Adjusted New transaction Conditions

field created
Project Always
number
Category Always
Quantity Always
Line Only if Accrued revenue exists on the
property transaction, and the line property
where the Can be accrued
checkbox is selected, to a line
property where this checkbox is not
selected.
Currency Only if Accrued revenue exists on the
transaction.
Sales price Only if Accrued revenue exists on the
transaction.
Cost price Only if The ledger status is Profit & loss or
Balance.
Dimension Only if Accrued revenue exists on the
transaction.
The ledger status is Profit & loss or
Balance.
Activity Never
Item tax Never
group
Tax group Never
Transaction Never
text

The following values can be adjusted without reversing the original transaction in
the ledger:

• Activity
• Tax group and item tax group
• Transaction text

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The line property, currency, sales and cost price can only be adjusted together
with dimensions under the circumstances previously described.

The project ID, category and quantity always reverse the original transaction and
create a new one, because these are necessary elements in a project transaction.

Procedure: Adjusting Transactions

You can adjust project transactions in Microsoft Dynamics AX one at a time, or
select from a list of all project transactions.

You can adjust one transaction as a whole on one adjustment line, or you can
change a part of the transaction by dividing it into multiple lines.

If you want to change only part of a transaction, you can split the transaction into
lines. The total amount for the lines must equal the amount in the original
transaction.

1. Open Project management and accounting > Periodic >

Adjustments.
2. If you want to adjust transactions in a single project:
a. Open Project management and accounting > Common >
Projects > All projects.
b. Select the project with the transaction or transactions to be
adjusted.
c. On the Manage tab, in the Process group, click New
adjustment.

3. In the Adjustment form, click Select.

4. In the Create adjustment transactions form, select the parameters
by which you want to filter transactions, and then click OK.
5. In the Adjustment form, select one or more transactions to be
adjusted, and then click Adjust.
6. In the Adjust transactions form, in the Split in number of lines
field, enter the number of new adjustment lines that you want to
create.
7. In the New value for selected lines area, specify any changes that
you want to make to the assigned project, activity, category, or line
property for these adjustments.
8. In the Field update area, clear the check boxes of the values that you
do not want to appear in the new transactions, and then click OK.
9. In the lower pane in the Adjustment form, make any additional
changes that you want to the new lines.
10. Click Check to ensure there are no problems with the adjustment
lines, and then click Post.

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Update, Check, and Post New Transactions

When adjusting transactions, you can update the new transaction(s) instead of
manually entering the new values. Related fields can be updated automatically
when the parameter, Autoupdate field, is enabled on the Project management
and accounting parameters form.

When a user changes a certain category which has different sales prices or line
properties, these related fields are updated automatically.

To check for new values, highlight the adjustment and then click Update. You
can then update everything or just the line property, currency, cost, or sales price
and post the adjustment.

NOTE: If a category is changed, the corresponding cost and sales prices may
have to be updated to reflect the new category. Make sure that you check their
values before posting the adjustment.
After checking that the transaction is valid, post it with the new values. This is
also helpful if someone enters an incorrect sales price for a worker and the
posted transactions have to be adjusted. After the sales price on the project is
changed, adjust the transactions and update the sales price for each line.

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Lab 3.6 - Adjust a Posted Transaction

In this lab, you will adjust a posted transaction.

Scenario

The project manager for project Service Orchid Shopping Mall has noticed an
error on some timesheet entries for the month of May. It is decided that all hours
entered as Install for the month of May should have been entered as Service.

Challenge Yourself!
Make the necessary adjustment transactions.

Need a Little Help?

Use the date selection on the Select page to limit the transactions that can be
adjusted.

Step by Step

1. Open Project management and accounting > Common >

Projects > All projects.
2. Double-click project 10008 - Service Orchid Shopping Mall.
3. On the Action Pane, select the Manage tab. Then in the Process
group, click Adjustments.
4. Click Select.
5. Select the Hours checkbox and enter "5/1/2008" as the From date
and "5/31/2008" as the To date.
6. Click OK.
7. Click the checkbox on the left of Transaction type to select all.
8. Click Adjust.
9. Select Service for Category, and then click OK.
10. Click Post.

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Journal Setup
The project journals correspond to the project transaction types and are set up in
different locations in Microsoft Dynamics AX.

Transaction Entered in Posted in Can use Set up in module

type journal approval?
Hours Hour Project Yes Project
journal management and
accounting
Fees Fees Project No Project
journal management and
accounting
All Beginning Project No Project
balance journal management and
accounting
Expenses Expense Ledger Yes Inventory and
journal warehouse
management
Item Item Inventory No General ledger
journal

Hour, Fee, and Beginning Balance Journal

To set up the hour, fee and beginning balance journals, open Project
management and accounting > Setup > Journals > Journal names.

FIGURE 3.27 JOURNAL NAMES FORM

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Project Essentials in Microsoft Dynamics® AX 2012

Create as many journals as needed. Each journal allows of the user to enter a
transaction text set up journals with default values for certain types of employees.

These are the fields available in the Journal names form:

Field Description
Name The name of the journal. This name appears when the user
selects a journal for posting.
Description A description of the journal.
Journal type A selection of a journal types. The journals that you name
are available in different locations in the application
depending on the type that you assign to them.
Voucher A selection of voucher series that can be used in journals
series that have the current journal name attached.
NOTE: Voucher series are defined in the Number
sequences form (Open Organization administration >
Common > Number sequences > Number sequences.).
Selection by Field in which to set up voucher numbers to be selected or
drawn when you post or entering lines.
New voucher Field in which to specify whether a new voucher should be
by selected when the voucher date changes, or when the
employee entry changes.
Set voucher Field in which to set voucher date. This can be found as
date to follows:
Project period end date - The end date of the project
period. The project period attached to the worker determines
the voucher date.
Ledger period end date - The end date of the ledger
period. The current ledger period determines the voucher
date.
Project Date - According to the project date. The voucher
date is identical to the project date entered on the journal
line.
Detail level Option in which to specify whether transactions should be
posted as individual lines or summarized in a limited
number of records when they are posted to the general
ledger.
If Summary transactions with identical dates are selected,
the account number, dimension, and currency code values
are summarized in one record per posting in the general
ledger.
Delete lines Check box to indicate whether journal lines should be
after posting deleted after posting is completed.

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Field Description
Private for The user group that has exclusive access to the journal.
user group
Approve Journal status to define the approval procedure of journals
that have the current journal name.
Show Applies to hour journals only.
start/end times Select this check box to activate the Start time / End time
fields in the Journal form. As an alternative to entering an
amount of hours in the Hours field on the Journal line enter
the start and end times.
The start and end time functionality is set up as a default for
all journals in Project management and accounting
parameters form.

Expense Journals
Project-related costs can be entered in the general journal in the general ledger
module and in an expense journal in the project management and accounting
module. To set up the project expense journal, open General ledger > Setup >
Journals > Journal names.

FIGURE 3.28 JOURNAL NAMES FORM EXPENSE JOURNAL

NOTE: The daily journal in the general ledger also allows for entry of project
costs. However, this journal cannot be used directly from the Project
management and accounting module.

All journal settings that apply journals created from the general ledger effect the
project expense journal. To enter the expense journals within the project
management and accounting module, set the Journal type to Project - expenses.

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Item Journals
The item journal is also a shared journal and can be accessed in both the Project
management and accounting module and the Inventory and warehouse
management module. To set up the item journal, open Inventory and
warehouse management > Setup > Journals > Journal names, inventory.

FIGURE 3.29 JOURNAL NAMES FORM ITEM JOURNAL

To enter the item consumption within the Project management and accounting
module, the Journal type must be set to Project.

Journal Approval
Journal approval procedures can enforce a set of approval rules for posting a
project journal. These procedures can be used to allow only certain user groups to
edit, check, approve, and post project hour journals.

To create a journal approval procedure, open Project management and

accounting > Setup > Journals > Journal approval. Once a new procedure is
named, clicking Lines will set the approval rules. Indicate how many levels of
approval are needed and which actions are available for each level of approval.

There are three types of action for each approval level available:

• Ready for posting

• Check journal
• Editing

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The GroupID field ties to which user group has the rights to perform the actions
associated with approval step. Set up user groups in the System administration
module.

FIGURE 3.30 JOURNAL APPROVAL SETUP FORM

The Journal Approval Setup form supports the following process:

• In the first step (Enter), the Apprentice can check and edit the hour
journal.
• The next step (Approve) involves the Manager checking and
approving the journal.
• The final step (Post) allows the Manager to check and post the
journal.

Once a journal approval procedure has been created, you can attach it to a journal
name on the General tab of the Journal names window.

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Journal Descriptions
Journal descriptions provide users with a set of standard transaction texts to be
entered on journal lines and enforce standardization of transaction texts in project
journals. Use default journal texts as a transaction to ease the entry of transaction
in journals and to achieve a consistency in transaction recording.

To set up a journal text, open Project management and accounting > Setup >
Journals > Journal descriptions.

FIGURE 3.31 JOURNAL TEXTS FORM

Search name is a shortcut for entering a transaction text in a journal.

When you type the shortcut name in the Description field, the system locates the
correct text and inserts it automatically upon accepting.

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Ledger Posting Setup

The general ledger posting rules for project transactions can be set up at several
levels. To access the overview, use the Ledger posting setup form. Open
Project management and accounting > Setup > Posting > Ledger posting
setup.

Cost Accounts

FIGURE 3.32 LEDGER POSTING SETUP COST ACCOUNTS TAB

The following table describes in detail the different ledger posting options for
time and materials (T&M), fixed-price (F-P), and internal (Int.) projects.

Type Description Accounts T&M F-P Int.

Cost Debited when hours, P&L X X X
costs and items are
posted.
Payroll Credited when hours are P&L/ X X X
allocation posted. Balance
WIP - Cost value on capitalized Balance X X X
cost value not accrued costs.
Cost - Time and material - P&L X X X
items Credited when item costs
are posted, debited when
an invoice is updated.
Fixed-price - Credited
when posting WIP.
Internal - Credited when
item costs are posted,
debited when you run the
script Post costs.

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Type Description Accounts T&M F-P Int.

WIP - Time and material - Balance X X X
cost value Debited when item costs
- items are posted, credited when
an invoice is updated.
Fixed-price - Debited
when you post WIP.
Internal - Debited when
item costs are posted,
credited when you run
the script Post costs.

Revenue Accounts

FIGURE 3.33 LEDGER POSTING SETUP REVENUE ACCOUNTS TAB

The following table describes in detail the different ledger posting revenue
accounts for time and materials (T&M), fixed-price (F-P), and internal (Int.)
projects.

Type Description Accounts T&M F-P Int.

Invoiced Credited when invoicing P&L X
revenue turnover.
Invoiced Time and material - P&L/ X X
on- Credited when on- Balance
account accounts are posted,
debited when offset on
invoice update.
Fixed-price - Completed
contract: Credited when
on-accounts are posted,
debited when eliminating
project.
Completed percentage -
Credited when on-
accounts are posted.

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Type Description Accounts T&M F-P Int.

Accrued Time and material - P&L X X
revenue - Credited when costs'
sales sales value and revenue
value are posted, debited when
invoice is updated.
Fixed-price - Completed
contract: Contract
amount credited when
eliminating project.
Completed percentage -
Contract amount
multiplied by percentage
of completion minus on-
accounts is created when
posting WIP.
WIP - Time and material - Balance X X
sales Costs' sales value and
value revenue debited when
posted, credited upon
invoice update.
Completed percentage -
Contract amount
multiplied by percentage
of completion minus on-
accounts is debited upon
posting WIP.
Accrued Completed percentage - P&L X
revenue - Credited costs' value
production when posting WIP.
WIP - Completed percentage - Balance X
production Debited costs' value
when you post WIP,
credited when
eliminating project.

Posting Setup by Project Group or Category

You can use Posting setup form to further control the general ledger accounts to
which project transactions should be posted.

You can post transactions according to projects, project groups, and funding
sources, or according to categories and category groups, or any combination of
these criteria. When you create project groups, you define the search priority as
project-first or category-first to determine which posting rules take precedence
when the system searches for posting accounts.

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The following table applies to posting by project.

Priority Project group Category group

1 Project Category
2 Project Category group
3 Project All categories
4 Project group Category
5 Project group Category group
6 Project group All categories
7 All projects Category
8 All projects Category group
9 All projects All categories

Use the following matrices to view the different kinds of ledger accounts that
require setup for time and materials (T&M), fixed-price (F-P), and internal (Int.)
projects.

Cost Accounts

Type Description Accounts T&M F-P Int.

Cost Debited when hours, costs P&L X X X
and items are posted.
Payroll Credited when hours are P&L X X X
allocation posted.
WIP - Cost value on capitalized Balance X X X
cost not accrued costs.
value
Cost - Time and material - P&L X X X
item Credited when item costs
are posted, debited when
invoice is updated.
Fixed-price -
Credited when you post
WIP.
Internal -
Credited when item costs
are posted, debited when
you run the script Post costs.
WIP - Time and material - Balance X X X
cost Debited when item costs are
value - posted, credited when
item invoice is updated.

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Type Description Accounts T&M F-P Int.

Fixed-price -
Debited when you post
WIP.
Internal -
Debited when item costs are
posted, credited when you
run the script Post costs.
Accrued Post estimate - P&L X
loss If there is a foreseeable loss
on the project, the account is
debited with an expense
transaction.
Fixed-price -
Projects with the completed
contract assessment
principle, the account is
credited.
WIP - Post estimate - Balance X
accrued If there is a foreseeable loss
loss on the project, the account is
credited with an expense
transaction.
Fixed-price -
For fixed-price projects with
the completed contract
assessment principle, the
account is debited.

Revenue Accounts

Type Description Accounts T&M F-P Int.

Invoiced The account is credited P&L X
revenue when time and material
projects are invoiced.

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Type Description Accounts T&M F-P Int.

Invoiced Time and material P&L / X X
revenue - on Credited when on- Balance
account accounts are posted,
debited when off-set on
invoice update.
Fixed-price
Completed contract:
Credited when on-
accounts are posted,
debited when eliminating
project.
Completed percentage:
Credited when on-
accounts are posted.
Accrued The account is credited P&L X X
revenue - on time and material
sales value projects if the Accrue
revenue options on the
project group are set to
anything other than
None.
WIP - sales The account is debited on Balance X X
value time and material
projects if revenue is set
to be accrued on the
project group and the
Accrue revenue check
box is selected on the line
property.
Accrued For fixed-price projects P&L X
revenue - with the completed
production percentage assessment
principle, the account is
credited with a fee
transaction that is created
when an estimate is
posted.
WIP - Completed percentage: Balance X
production Debited costs' value
when you post WIP,
credited when
eliminating project.

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Type Description Accounts T&M F-P Int.

Accrued Completed percentage: P&L X
revenue - Credited margin
profit multiplied by completion
percentage when you
post WIP.
WIP - profit Completion percentage: Balance X
Debited margin
multiplied by completion
percentage when you
post WIP, credited when
eliminating project.
Accrued If On-account invoicing P&L X
revenue - is set to Profit and loss
On-account on the project group for
fixed-price projects, the
account is debited to
move the on-account
invoicing to the balance
sheet.
WIP - Time and material - Bal X X
Invoiced - Account is credited on
On-account invoicing of time and
material projects.
Fixed-price -
The account is credited
on fixed-price projects if
Profit and loss is
selected in the On-
account invoicing field
on the project group.
Accrued The WIP - subscription P&L X
revenue - is debited with the
subscription accrual amount, and the
Accrued revenue -
subscription is credited
with the accrual amount.
WIP - WIP - subscription is Balance X
subscription debited with the same
amount that the account
of type Accrued revenue
- subscription is credited
with.

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Summary
In Microsoft Dynamics AX, you register transactions—such as hours, expenses,
items, and fees—to projects through journals or business documents using
distributions. You can use Microsoft Dynamics AX to set up journals and journal
approvals. It’s also important to understand that different project types will
respond differently to transaction posting.

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Test Your Knowledge

Test your knowledge with the following questions.

1. Which of the following are project transaction types?

( ) Item
( ) Fee
( ) Expenses
( ) All of the above

Fill in the blanks to test your knowledge of this section.

2. This cost of this transaction type is linked to the financial compensation of

workers. _____

3. The purpose of this feature is to simplify the administration of posting

specifications. _____

4. This transaction property can control whether an additional cost percentage

should be applied. _____

5. Which of the following can be set as a default values for the Hours journal?
( ) Project group
( ) Project date
( ) Project number
( ) A sales price amount

6. When setting up cost pricing, what is the only required field?

( ) Category
( ) Date
( ) Worker
( ) Project

7. Which of the following are required information when entering an expense

transaction on a project? (Select all that apply)
( ) The date the expenses are registered.
( ) The amount of sales tax to be expensed.
( ) The categories of expenses to be allocated.
( ) The ledger account the expenses are to be settled against

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8. Which of the following features are available when you set up journal
approval? (Select all that apply)
( ) An approval procedure can contain various approval stages.
( ) Rights to specific groups cannot be set up.
( ) Different user groups can each have several assigned approval stages
to guarantee a correct timesheet.
( ) Different journal statuses can be used on several different project
journals.

9. Which of the following is not an option for a period code?

( ) Hourly
( ) Weekly
( ) Monthly
( ) Quarterly

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Quick Interaction: Lessons Learned

Take a moment and write down three key points you have learned from this
chapter

1.

2.

3.

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Solutions
Test Your Knowledge
1. Which of the following are project transaction types?
( ) Item
( ) Fee
( ) Expenses
(•) All of the above

Fill in the blanks to test your knowledge of this section.

2. This cost of this transaction type is linked to the financial compensation of

workers. Hour

3. The purpose of this feature is to simplify the administration of posting

specifications. Category Group

4. This transaction property can control whether an additional cost percentage

should be applied. Line property

5. Which of the following can be set as a default values for the Hours journal?
( ) Project group
(•) Project date
( ) Project number
( ) A sales price amount

6. When setting up cost pricing, what is the only required field?

( ) Category
(•) Date
( ) Worker
( ) Project

7. Which of the following are required information when entering an expense

transaction on a project? (Select all that apply)
(√) The date the expenses are registered.
( ) The amount of sales tax to be expensed.
(√) The categories of expenses to be allocated.
(√) The ledger account the expenses are to be settled against

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8. Which of the following features are available when you set up journal
approval? (Select all that apply)
(√) An approval procedure can contain various approval stages.
( ) Rights to specific groups cannot be set up.
(√) Different user groups can each have several assigned approval stages
to guarantee a correct timesheet.
( ) Different journal statuses can be used on several different project
journals.

9. Which of the following is not an option for a period code?

(•) Hourly
( ) Weekly
( ) Monthly
( ) Quarterly

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