Background

This support articles covers how Freight works in AccountEdge - specifically addressing how it works with Purchases and the steps you need to take to include Freight as a part of an items' cost.

Freight and AccountEdge

When you create a purchase or a sale in AccountEdge there is a field on the bill/invoice to include the cost of Freight. This cost is for the entire bill/invoice and not tied to any specific item or line item.

To use the Freight field on sales and purchases you need to first set this option up. You can start using Freight by following these steps:

Sales

1. Go to Setup from the menu bar at the top of the screen
2. Choose Linked Accounts > Sales Accounts
3. Check the box next to "I charge freight on sales"
4. Select an appropriate Income account to post your freight charges to
5. Hit okay

Purchases

1. Go to Setup from the menu bar at the top of the screen
2. Choose Linked Accounts > Purchases Accounts
3. Check the box next to "I pay freight on purchases"
4. Select an appropriate Expense or Cost of Sales account to post your freight charges to
5. Hit okay

Including Freight Costs in Your Item's Cost of Sales

Because AccountEdge's Freight charges are associated with an entire transaction and not a specific item then any items you have will not include the Freight in their Cost of Sales. There are two options for how to manage this.

Option 1

• Initial Setup
  1. Create an Item called Freight
  2. This item should be set as I Buy, I Inventory - choose appropriate Asset and Cost of Sales accounts for this
• Including Freight on Purchase
  1. Enter your purchased line items as normal
  2. Include the Freight line item - billing however many Freight items would equal the total number of the items
  3. Enter the total for the cost of freight in the line
  4. Don't include Freight in the Freight field of the bill
• Including Freight Charge in Cost of Sales
  1. Go to Inventory > Build Items
  2. You are going to add and subtract the same item - but add the item back with the cost of the freight
  3. You are also going to be subtracting the Freight - building it into the cost of the items

Option 2

• Initial Setup
  1. Go to Setup from the menu bar at the top of the screen
  2. Choose Linked Accounts > Purchases Accounts
  3. Check the box next to "I pay freight on purchases"
  4. Select an appropriate Expense account to post your freight charge to (normally an account call Freight)
  5. Hit okay
• Including Freight on Purchase
  1. Enter the purchase line items as normal
  2. Include the Freight in the Freight field of the bill
• Adding the Cost to the Item (increasing the value of the item)
  1. Go to Inventory > Adjust Inventory
  2. Enter in the item number you wish to add freight to
  3. Leave the quantity at zero
  4. Add the total cost of freight in the amount field
  5. Select the Asset account that the item uses as the account (you can see this by clicking on the arrow next to the item)
  6. Click record
• Increasing the Asset account's value (this will remove the cost from the Freight account and add it to the value of the item - increasing the COGs for that item)
  1. Go to Accounts > Record Journal Entry
  2. Choose to debit that Inventory Asset account for the item used by the amount of the Freight
  3. Choose to credit the Linked Freight Expense account for the amount of the Freight