Purchases to the Project Site: Process Activity

This activity will walk you through the process of purchasing materials for the project site.

Story

Suppose that the HM's Bakery and Cafe customer has ordered two juicers, along with four hours of the installation service from the SweetLife Fruits & Jams company. The project accountant has analyzed the requirements and decided to create a small cost-plus project with two tasks, each for the installation of a juicer, and specify the cost budget of a project.

Further suppose that SweetLife's project manager has noticed that the warehouse currently has no juicers of the requested type. The project manager has decided to purchase the juicers from the Squeezo Inc. vendor and request the vendor to ship the items directly to the project site. The project manager decided not to track the receipt of items to the project site as a separate document and to consider the provided installation services as the confirmation of the items being received.

Acting as SweetLife's project manager, you will configure a project to handle the tracking and billing of the provided services and stock items. Then you will create a drop-ship order for purchased items for the project and create an accounts payable bill for the vendor. Finally, you will review the commitment to the project budget.

Configuration Overview

In the U100 dataset, the following tasks have been performed for the purposes of this activity:

• On the Enable/Disable Features (CS100000) form, the following features have been enabled:
  • Project Accounting, which provides the project accounting functionality
  • Inventory and Order Management, which provides the sales order and purchase order functionality
  • Inventory, which provides the stock item functionality
• On the Project Templates (PM208000) form, the SERVCSP project template has been created.
• On the Vendors (AP303000) form, the SQUEEZO vendor has been created.
• On the Customers (AP303000) form, the HMBAKERY customer has been created.
• On the Stock Items (IN202500) form, the JUICER05 stock item has been created.

Process Overview

You will create a project based on the project template on the Projects (PM301000) form and configure settings for the drop-ship purchases for the project. Then you will create a drop-ship order for the project and prepare a bill for it. Finally, you will review the commitment to the project budget and the generated project transactions.

System Preparation

Before you start creating a project and process a purchase, do the following:

1. Launch the MYOB Advanced website, and sign in as a project manager. You should sign in by using the brawner username and the 123 password.
2. In the info area, in the upper-right corner of the top pane of the MYOB Advanced screen, make sure that the business date in your system is set to 1/30/2023. If a different date is displayed, click the Business Date menu button, and select 1/30/2023 on the calendar. For simplicity, in this activity, you will create and process all documents in the system on this business date.
3. On the General tab (General Settings section) of the Projects Preferences (PM101000) form, make sure the Internal Cost Commitment Tracking check box is selected.

Step 1: Creating a Project

To create a project, do the following:

1. Open the Projects (PM301000) form.
   Tip: To open the form for creating a new record, type the form ID in the Search box, and on the Search form, point at the form title and click New right of the title.
2. Click Add New Record on the form toolbar, and specify the following settings in the Summary area:
   • Project ID: HMBAKERY16
   • Customer: HMBAKERY
   • Template: SERVCSP
   • Description: Installation of new juicers (253 Terry Lane)
3. On the Summary tab, select the Allow Adding New Items on the Fly check box.
4. On the Addresses tab, in the Project Address section, specify the following settings:
   • Address Line 1: 253 Terry Lane
   • City: New York
   • Country: US
   • State: NY
   • Postal Code: 10001
5. Save your changes to the project.
6. On the Tasks tab, make sure that the PHASE1 and PHASE2 tasks have been added to the project.
7. On the table toolbar, click Activate Tasks to change the status of the project tasks to Active.
8. On the Cost Budget tab, make sure that two lines with the JUICER05 item and two lines with the INSTALL item have been added.
9. On the Defaults tab, make sure that the following settings have been specified:
   • Use Expense Account From: Posting Class or Item
   • Drop-Ship Receipt Processing: Skip Receipt Generation

     With this setting, items of any type added to a purchase order of the Project Drop-Ship type are processed without a purchase receipt.

10. On the form toolbar, click Activate Project. The system assigns the project the Active status.

Step 2: Creating a Project Drop-Ship Order

Create and process a drop-ship order for the project as follows:

1. Set the business date to 2/15/2023.
2. Open the Purchase Orders (PO301000) form.
3. In the Type box, select Project Drop-Ship.
4. In the Summary area, specify the following settings:
   • Vendor: SQUEEZO
   • Date: 2/15/2023
   • Project: HMBAKERY16
   • Description: Installation of juicers at the restaurant
5. On the Details tab, add a row with the following settings:
   • Inventory ID: JUICER05
   • UOM: PIECE (specified automatically)
   • Order Qty.: 1
   • Unit Cost: 500
   • Project Task: PHASE1
   • Cost Code: 00-000
6. Add another row with the following settings:
   • Inventory ID: JUICER05
   • UOM: PIECE (specified automatically)
   • Order Qty.: 1
   • Unit Cost: 500
   • Project Task: PHASE2
   • Cost Code: 00-000
7. Save the drop-ship order for the project. On the Shipping tab, review the shipping settings specified for the purchase order and notice that the Shipping Destination Type is set to Project Site.
8. On the More menu (under Printing and Emailing), click Print Purchase Order. In the prepared printable document, review the Ship To section, and make sure that the shipping address has been copied from the project settings.
9. Close the browser tab with the report and return to the drop-ship order for the project on the Purchase Orders form.
10. On the form toolbar, click Remove Hold. The system assigns the purchase order the Open status. When the Open status is assigned to the purchase order, the system creates the commitment for the project.
11. On the Projects form, open the HMBAKERY16 project, and on the Commitments tab, make sure the drop-ship order for the project is shown.
12. On the Cost Budget tab, review the cost budget lines with the JUICER05 inventory item that the system has updated based on the commitment.

    Notice that the original committed and revised committed amounts and quantities in the lines have been updated by the amounts from the drop-ship order lines for the project. The actual amount in both lines is still zero because the expenses have not yet been recorded to the project.

13. On the Commitments tab, click the Order Nbr. link in the only line to open the project drop-ship order that you have created earlier in this activity on the Purchase Orders form.
14. On the form toolbar, click Enter AP Bill to create a bill for the purchase order.

    The system creates an accounts payable bill and opens the bill on the Bills and Adjustments (AP301000) form. Make sure that both purchase order lines have been added to the bill.

15. On the form toolbar, click Remove Hold to assign the AP bill the Balanced status, and then click Release to release the bill.
16. On the Projects (PM301000) form, open the HMBAKERY16 project.

    On the Cost Budget tab, review the actual values of the cost budget. Notice that the Actual Quantity and Actual Amount of the lines with the JUICER05 item have been updated and are now 1 and 500.00, respectively (see the following screenshot). Also notice that the actual expenses of the project (in the Actual Expenses box of the Summary area) are 1,000.00, which is the cost of the purchased juicers.

    
    
    

You have finished processing a drop-ship purchase order to the project site.