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Flow of Macola® accounting transactions

Adapted from the Leahy Consulting reference chart "Flow of Macola® accounting transactions", updated February 2012.

One table per processing step, showing what each one debits and credits and whether it updates average cost. It is the fastest way to answer "did that step post anything?" without opening the software.

The Average cost updated? column matters more than it looks: a step that updates average cost changes the value of everything on hand, not just the transaction in front of you.

Purchasing and payables

Processing step Debit Credit Average cost updated?
P/O processing and printing — key in and print a purchase order none none No
P/O receiving and posting — key in P/O receivings Inventory / supplies account Receiving accrual account Yes
A/P invoice entry — vendor invoices are keyed as they are received none none No
A/P invoice posting — P/O number was specified during invoice entry Receiving accrual account A/P No
A/P invoice posting — no P/O number was specified during invoice entry Inventory / supplies account A/P No
A/P check processing — print and post A/P checks A/P Cash No

Customer orders and receivables

Processing step Debit Credit Average cost updated?
Key in customer shipments none none No
Print invoices none none No
Post invoices A/R, and cost of sales Sales, and inventory No
Cash receipts Cash A/R No

General ledger

Processing step Debit Credit Average cost updated?
Perform G/L interface from A/P, A/R and I/M none none No
Post interfaced transactions from A/P, A/R and/or I/M — — No
Print monthly financial statements — — No

Production orders — allocate with no distributions

Processing step Debit Credit Average cost updated?
Key in / release production order none none No
Report production quantities — no value-added factors Finished goods inventory Component / part inventory Yes
Report production quantities — with value-added factors (labor hours, overhead) Finished goods inventory, and finished goods inventory again Component / part inventory, and the VAF absorption account Yes
Cost adjustments — — Yes
Material adjustments Finished goods inventory Component / part inventory asset Yes
VAF cost adjustments Finished goods inventory VAF absorption account Yes

Production orders — allocate with WIP

Processing step Debit Credit Average cost updated?
Key in / release production order WIP for the parent item Component / part inventory asset No
Key in / release production order, with value-added factors WIP for the parent item VAF absorption account No
Report production quantities — no value-added factors Finished goods inventory WIP for the parent item Yes
Report production quantities — with value-added factors Finished goods inventory, and finished goods inventory again WIP for the parent item, twice Yes
Material adjustments Finished goods inventory Component / part inventory asset Yes
VAF cost adjustments Finished goods inventory VAF absorption account Yes

Tracing a transaction

When a number needs chasing, these are the reports that carry it, in the order the transaction moves.

Purchase orders, before receiving

  • Scheduled Receipts report
  • P/O Line History report
  • P/O Inquiry
  • Cash Requirements Projection report
  • Open P/O reports

Purchase orders, after receiving

  • Receiving Audit Trail report
  • P/O Inquiry
  • Received / Not Invoiced report

Accounts payable, at entry

  • New A/P Transaction report
  • New A/P Transaction Register
  • A/P Distribution to G/L report
  • Vendor Account inquiry
  • Open Item report
  • Cash Requirements report
  • Job Distribution report
  • Vendor Analysis report

Accounts payable, after payment

  • Check History report
  • Vendor Inquiry

The general ledger accounts each of these steps uses are covered in Which G/L account will Macola® use?.

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