• Expense Feature Overview

  Overview RevRec’s Expense feature supports expense recognition for ASC 606 contract costs which are incremental expenses related to either obtaining or fulfilling a sales contract. Additionally, RevRec supports expense recognition for other costs that are not directly related to a contract but could be a part of the cost of goods sold (COGS). The expense recognition feature classifies the costs into two distinct types as defined below: Contract Costs: This is the incremental cost thatFew readers

• Configuring Expense Rules

  RevRec’s Expense feature can recognize the business or contract cost associated with a subscription, based on a set of rules defined. The accounting rules are a set of guidelines provided by you to the system. These guidelines help the system in deciding the correct treatment for each type of expense. You can configure the accounting rules either through the application UI or through bulk upload functionality. Creating Expense Recognition Rules via UI Follow the steps below to create anFew readers

• Providing Expense Input Data

  You can provide contract and other cost-related data in RevRec using the following ways: Manual input of data using the Sale Order UI. Bulk upload of data using the Sync UI. Manual Input of Expense Data You can enter the expense data directly in RevRec via the application UI. Follow the steps below to add new expense data on your RevRec site: Click the Expense menu item on the left panel. The Expense page displays two tabs - Contract Cost and Other Cost. (hFew readers

• Reviewing Expense Results and Reports

  You can view the associated contract cost, its allocation, and recognition schedule for each product from the sales order UI, while you can see aggregate information related to expenses on the report. You can also drill down using the various attributes available in the drill hierarchy. Sales Order UI Contract costs associated with sales orders can be viewed or edited from the sales order screen. ClFew readers

• Expense GL Accounts and Journal Entries

  General Ledger Accounts New default GL accounts are set up for a contract and other cost recognition with the following account types: |Account Number|Account Name|Account Type| |6000|Expense Clearing (EC)|Expense Clearing| |1000|Deferred Expense (DE)|Deferred Expense| |5000|Expense Recognized (ER)|Expense Recognized| Expense Deferral & Recognition Whenever a Contract Cost or Other Cost is added, RevRec books the following entry and establishes a deferred cost:Few readers

• Expense Examples

  1: Expense Follows Revenue Plan In this example, we have two products A1 and A2 within the sale order “SO1”. “New Commission” expense of $1200 is provided against product A1. Accounting Rule for “New Commission” defines this expense as “Contract Cost” and the expense will follow the revenue amortization plan of product A1, and not be re-allocated. Sale Order: Expense: (https://storage.crisp.Few readers