Freight Charges and DYNAMIC 3i

FREIGHT CHARGES AND DYNAMIC 3i

In Dynamic3i, freight charges, by default are posted to the general ledger based upon the currency. The cost of the freight per item is part of the product cost and is maintained in the Product Cost Maintenance - (in1110).

There are three accounts defined for freight in the Currency Master Maintenance (gb0700):

For Order Entry Control Accounts there is ‘Freight’ and ‘Freight Returns’. For Accounts Payable there is ‘Accrued Freight’.

Order Entry:

‘Freight’ - G/L account is posted to by Order Entry – Invoice Update (oe4100) with the freight charge (if any) of the order. This amount is found on the order header

‘Freight Returns’ - G/L account is also posted to by Order Entry – Invoice Update (oe4100) but is used only when the order is a ‘Credit” type order. This will track freight charges incurred by the original order if they were charged and credited.

Accounts Payable:

Accrued Freight’ - G/L Account is posted to by the PO to G/L update (PO5300) with the freight charges (if any) of the item being purchased.

Instead of using the default Order Entry Freight Control Accounts it is possible to have Dynamic3i use the std. Reason Codes to post freight. This is done by selecting the ‘Freight by Reason Code’ flag on the System Flags Maintenance – gb2800).

When selected this will cause the order entry posting routines to use the reason code defined to the ship-to customer and post any freight charges for the order to the ‘Order Entry Freight’ G/L under the clearing Accounts defined in the Reason Code Master Maintenance (gb4300)

On the Reason Codes there are also three accounts:

Under Sales Order - ‘Order Entry Freight’.
Under Clearing – ‘Freight Clearing’.
Under Variances – ‘Freight Variance’.

‘Order Entry Freight’ - will be used for Order Entry Freight with this reason code, for this warehouse. If the Freight by Reason Code flag has been set in the System Flags Maintenance (gb2800)

‘Freight Clearing’ – G/L account is posted to by P/O to G/L Update (po5300) with the freight charges (if any) of the item being purchased.

‘Freight Variances’ – Used in A/P Invoice matching (ap1100) to post any variance in freight charges between what was invoiced and what was charged when the item was received.

In Summary:

Standard Default Posting

Freight charges on Orders will be posted to the ‘Freight’ G/L account defined on the currency master maintenance under Order Entry Control Accounts.

Freight charges on Purchases will be posted to the ‘Freight Clearing’ G/L based upon the product group, reason code / warehouse combination of the item purchased.

Freight variances (if any) when entering/matching a freight invoice (ap1100) will be posted to the ‘Freight Variance’ G/L account based upon the items product group, reason code / warehouse combination.

Freight by Reason Code
(Order Entry System Flags – Freight by Reason Code flag is set)

Freight charges on Orders will be posted to the ‘Order Entry Freight’ – G/L account.