Introduction

When a company buys goods, the supplier price is rarely the only cost. Freight, insurance, customs duty, and handling fees are also part of what the goods truly cost. In Business Central, these additional costs are recorded as Item Charges. An Item Charge is posted on a document line and then assigned to the item entries it relates to. This way the extra cost becomes part of the item cost instead of sitting only in an expense account.

Setting Up Item Charges

Item charges are created on the Item Charges page. Each type of additional cost should have its own code, for example FREIGHT, INSURANCE, CUSTOMS, and CLEARING.

• No.: Specifies the number of the involved entry or record.
• Description: Specifies a description of the item charge number that you are setting up.
• Gen. Prod. Posting Group: Together with the vendor or customer Gen. Bus. Posting Group, it decides the G/L account used when the charge is posted.
• Tax Group Code: Specifies the sales tax group code that this item charge belongs to.
• VAT Prod. Posting Group: Decides how VAT is calculated on the charge.
• Search Description: Specifies text to search for when you do not know the number of the item charge.

Assignment Methods

The Suggest Item Charge Assignment action distributes the charge using one of four methods.

Example: A freight invoice of SAR 1000 is assigned By Amount to two receipt lines. Item A has a line amount of SAR 6000 and Item B has SAR 4000. Item A receives SAR 600 and Item B receives SAR 400.

The suggestion can always be changed manually before posting.

Documents That Can Receive Item Charges

A purchase item charge can be assigned to:

• Purchase Receipt Lines
• Purchase Return Shipment Lines
• Transfer Receipt Lines
• Sales Shipment Lines
• Sales Return Receipt Lines

A Sales item charge can be assigned to:

• Get Shipment Lines

Item Charge Process

The standard process on a document is as follows:

Remember the fields I am showing in this section is available on both Sales and Purchase Documents. For this Section I am using the Purchase Document.

• Post the Receipt/Shipment for the items as usual.
• Create an Invoice for the Charge. The vendor can be the item supplier or a different vendor, such as a shipping company.

• Add a line with Type set to Charge (Item) and select the item charge, for example FREIGHT.
• Enter the Quantity (usually 1) and the Direct Unit Cost.
• On the line, choose Item Charge Assignment or one shortcut way to click on the Number coming in Qty. to Assign.

• Choose Get Receipt/Shipment Lines and select the Receipt/Shipment lines the charge relates to.

• Choose Suggest Item Charge Assignment and select a distribution method.

• Select the Method and click on Ok and then review the Qty. to Assign and Amount to Assign on each line, then close this page.

• Below this Page there are Few Options which Required Discussion. For that we will manually remove the Quantity to assign for one line and then checks the number comes under.

• Assignable – Quantity currently available to be assign.
• To Assign – Total quantity that is assigned to the document.
• Remaining to Assign – Quantity left to assign after partial assignment.
• To Handle – Total quantity that is handled as per above lines.
• Remaining to Handle – Quantity left to handle after partial processing.

• If the items and the charge are on the same purchase invoice, the item lines of that document appear in the assignment page automatically. There is no need to get receipt lines.

• When you will close this then it will change the Qty to Assign from 0 to your quantity number.

• Now you can Post this Invoice.

Hope so this is Helpful 😊