General Ledger Accounts for Journal Entries

If your firm uses an approach that transfers any amount other than labor cost, you must decide which general ledger accounts to use for journal entries.

You can use existing accounts or create new general ledger accounts in the Accounts Info Center. Labor Cross Charge uses these accounts to process the journal entries that move the additional amounts.

Deltek recommends that you create new accounts for use with Labor Cross Charge. This makes it easier to track cross-charge transactions.

Some firms create one new account for both debit and credit entries. Other firms create two new accounts, one for credit entries and one for debit entries.

• If you use Labor Cross Charge to transfer overhead costs, the new accounts should be indirect expense accounts.
• If you use Labor Cross Charge to transfer Revenue, the new accounts should be revenue accounts.
• If you use Labor Cross Charge to transfer expense and revenue in the form of a consultant expense, the new accounts should be direct expense accounts.

Examples

If you use Labor Cross Charge to transfer expense and revenue in the form of a consultant expense, you might create these two accounts:

• Account:  699.10  Account Name: Consultant Expense (out)

This account receives the journal entry credit, transferring the consultant expense to the employee's Organization.

• Account:  699.20  Account Name: Consultant Expense (in)

This account receives the journal entry debit, transferring the consultant expense to the project's Organization.

In this example, you set up special projects with a Charge Type of Regular.

Firms planning to use Labor Cross Charge to transfer revenue might create these two accounts:

• Account:  423.10  Account Name: Labor Cross Charge Revenue (in)

This account receives the journal entry credit, transferring revenue to the employee's Organization.

• Account:  423.20  Account Name: Labor Cross Charge Revenue (out)

This account receives the journal entry debit, transferring revenue from the project's Organization.

In this example, you set up special projects with a Charge Type of Regular.