Add a New Division

This write‑up assumes this is the first time a division is being added, i.e. division 01 is currently set‑up and division 02 is being added, but the basic procedures hold true for adding any division. However, if this is the first division being added, i.e. 02, there are three things to be aware of:

1. The software must be set‑up by us. Programs must be re‑compiled with added support for multiple divisions.

2. There must be no regular A/R customers' numbers under 100. The system now assumes any sale to a customer number less than 100 is a merchandise transfer to another division. We can run a program to automatically re‑assign customer numbers for the Customer master and all of the other files that contain customer numbers. Please let us know if you need this service.

3. There must be no regular P/O vendor numbers equal to an existing division number. For example, if you have 2 divisions, you may not have regular vendor numbers 1 and 2, they must be re‑assigned with higher numbers. Vendor Numbers1 and 2 must be reserved for the two divisions.

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ADD VENDORS AND CUSTOMERS

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Vendors and customers will need to be added for transferring merchandise between locations. First go to:

Accounts Receivable (Module 2)
- Customer Master (Task 17)
  - Enter New Customer Record (Sub-task 1)

Add customer number 00001 and 0002. The new customer names and numbers should correspond to the division name and number.

At line 13, Price Type, enter A-for average cost-in each of the nine slots. This is the price that will be charged on merchandise being transferred. NOTE: Many clients add a new customer type for these new "customers". This will help for group discounts and running reports. Customer types can be setup in:

Accounts Receivable (Module 2)
- System Management functions (Task 32)
  - Modify Application Tables (Sub-task 17)
    - Customer Type Definitions (Option 3)

After the customers have been added, the vendors also must be added. Now go to:

Accounts Payable (Module 3)
- Vendor Master (Task 17)
  - Add New Vendor Record (Sub-task 1)

Add vendors 00001 and 00002. The new vendor names and numbers should correspond to the division names and numbers.

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GENERAL LEDGER

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General Ledger account numbers for the new division and General Ledger account numbers for intercompany transfers will need to be created.

NOTE: If you never intend to transfer merchandise from one division to another through Order Entry, then it is not necessary to add these special G/L account numbers.

1. Replicate Income Statement G/L accounts for the new division. Go to:

General Ledger (Module 4)
- System Management Functions (Task 32)
  - Create New Division G/L Accounts (Sub-task 9)

Division: Make sure when the system asks, “Division # to copy from:” you enter a valid, working division. Also make sure the division number entered operates THE SAME as the new division.

For example: if the new division is an FM, enter a division # of another FM that is working correctly. Some Profits Plus systems have G/L account #’s set up with the last two digits representing an “FM”. This is so they know how the rest of the FM division G/L account #’s should be set up. If you have these “FM” G/L account #’s setup, the “Division # to copy from:” should be an FM. When you enter an FM as the division # to copy from, you will get this message “Invalid division but will proceed w/check for accounts. CR TO CONTINUE”. Just press the ENTER key and ENTER key again at “Any Change? N”.

Use: Starting account number 500, Ending account number 999. This will copy the sale, cost of sales and miscellaneous income accounts to the new division.

NOTE: We do not recommend creating separate Balance Sheet G/L accounts for the new division. Past experience has shown a divisional balance sheet is very difficult to maintain and work with. Separate Fixed Asset Accounts can manually be added, with the middle two digits of the G/L account number designated as the new division.

2. Add Merchandise Transfer G/L Accounts.

Specific Sales and Cost of sales accounts will need to be added for Intercompany transfers.

Explanation: When merchandise is sold through Order Entry to a customer with a number less than 100 the system assumes it is a transfer and will distribute the sales and costs using the G/L numbers described below. If the required G/L numbers do not exist they will print with an "Unknown account" description on the daily invoiced orders posting register and corrections will need to be made at that time.

If you are not familiar with adding Account Numbers, please review the General Ledger section of the Operators Manual.

In the example below, it is assumed that the sales accounts and cost of sales accounts are 531‑539 and 631‑639 (if your account numbers are different, please substitute the appropriate numbers).

Add Accounts:

Cost of

Sales Sales

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531‑02‑01 631‑02‑01

531‑01‑02 631‑01‑02

532‑02‑01 632‑02‑01

532‑01‑02 632‑01‑02

and so on.

As a suggestion, call the accounts I/C SALES and I/C COST OF SALES. The I/C stands for inter‑company transfers. Leave the Statement & Schedule codes blank until the next step is completed.

The middle two digits are the "transfer to" division and the last two digits are the "transfer from" division.

Step 1: Assign Statement and Schedule Codes to new transfer G/L account numbers.

STATEMENT codes control the order of printing on the Income Statement and Balance Sheet.
SCHEDULE codes control the order of printing on the supporting schedules.

Transfer G/L accounts should be assigned account statement and schedule codes that will cause them to be included in the "COST OF SALES" total on the income statement and print the detail under the "COST OF SALES ‑ OTHER" section of the supporting schedule. The "sales" and "cost of sales" transfer amounts should always net out to zero, so there will no effect on the totals of the financial statements as long as the new accounts are grouped together within the same total or subtotals. We recommend putting them in the "COST OF SALES" section instead of the "SALES" section, only because transfers normally are not considered to be a sale.

First: Print G/L accounts sorted by statement code. Go to:
- General Ledger (Module 4)
  - G/L Accounts by Statement Code (Task 29) Answer the system prompts as follows:
  - Account # range: = 60000 ‑ 70000
  - Division #: = 01
  - Print group headers and totals? = Y
  - Statement code: = ALL
    - Find the account "COST OF SALES ‑ OTHER" or "COST OF SALES ‑ MISC" with a statement code ending in IP.
    - Write down the Statement Code and Schedule Code because they will be needed in STEP 2.
    - As an example: the STATEMENT code was P120IP and the SCHEDULE code was 1955GH
Second: Print G/L accounts sorted by schedule code.
- General Ledger (Module 4)
  - G/L Accounts by Schedule Code (Task 28) Answer the system prompts as follows:
    - Division #: = 01
    - Print group headers and totals? = Y
    - Schedule code: = 1955GH ‑ 130099 (just a few)
    - Account # range: = ALL
    - The first line that prints should be the same COST OF SALES ‑ OTHER account with Statement Code of, per our example, P120IP. Refer to the next column, it is the "Schedule Code".
    - Look down the report until the next schedule code that ends with an SS or ST is found. This will probably be "TOTAL COS ‑ OTHER" or something like that. All of the new transfer G/L account will be added between the GH and SS (or ST) schedule codes.
Third: Make a list of all G/L transfer accounts to be added with the necessary statement and schedule codes.

This example only shows 4 sales and 4 cost of sales transfer accounts. Your business may require more.

Stmt. Sched.

Description Account# Code Code

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Existing: COST OF SALES ‑ OTHER 650‑00‑99 P120IP 1955GH

Add: I/C SALES 546‑02‑01 P120VS 1962VP

Add: I/C SALES 546‑01‑02 P120VS 1962VP

Add: I/C SALES 547‑02‑01 P120VS 1962VP

Add: I/C SALES 547‑01‑02 P120VS 1962VP

Add: I/C COST OF SALES 646‑02‑01 P120VS 1963VP

Add: I/C COST OF SALES 646‑01‑02 P120VS 1963VP

Add: I/C COST OF SALES 647‑02‑01 P120VS 1963VP

Add: I/C COST OF SALES 647‑01‑02 P120VS 1963VP

Existing: TOTAL COS ‑ OTHER 650‑01‑99 P 1980SS

(See Operators manual for explanation of coding. IF the setting up of the transfer accounts causes a problem, We can provide the service of adding the accounts and assigning the Schedule & Statement codes. However, this is a billable service. Should this route be chosen, send in a fax with the request. So that the request can be done in a timely manner, please send it in well before the new division will be implemented to allow the Support personnel to schedule the appropriate time to complete the task.)

Step 2. Add merchandise transfer G/L accounts.

Go to:

General Ledger (Module 4)
- Account Master (Task 17)
  - Enter New G/L Act # Record (Sub-task 1)
    - Add the first transfer account in the list. Add as many as necessary, and answer the system prompts as follows:
    - 01. Account # : 546‑02‑01
    - 02. Acct descr : I/C SALES
    - 03. Fin St. code: P120VS
    - 04. Support Schd: 1962VP
    - 05. Paren Ctl : C
    - 06. Contra‑act :
    - 07. Wrk Cap Code:
    - 08. Indent # : 1

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INVENTORY

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Two options are available for setting‑up inventory items at the new location. The first is, the same basic inventory items and services from the original location, will be available at the new location. The second is, the new location will be a separate line of business with its own line of merchandise.

Option 1: Same inventory at new division.

Before running this procedure, expand the size of the Warehouse Master File. The size should be doubled. Go to:

Inventory Control (Module 5)
- Warehouse Master (Task 17)
  - Adjust size of Warehouse file (Sub-task 7)

After the size of the Warehouse file has been adjusted, copy from an existing division the new warehouse records for the new division(s). Go to:

Inventory (Module 5)
- Special I/C Processing Menu (Task 25)
  - Copy Warehouse Data to New Warehouse #'s (code: BLDWHS). Answer the system prompts as follows:
    - Starting and Ending item number: Enter key for ALL
    - Enter warehouse number to COPY FROM: 01
    - The right side of the screen will display a blank list of 15 new division numbers that can be created.
      - Enter the new division number at the 01. line and press Enter.
        
        The cursor moves to the 02. line.
        
        If more than one new division is being added, enter the next new division number.
        
        If this is last new division being added, then press ESC at the 02. line.

Example to add one new division:

New Warehouse Records

Warehouse #

01. 2

02. (ESC)

03.

04.

Example to add three new divisions:

New Warehouse Records

Warehouse#

01. 2

02. 3

03. 4

04. (ESC)

Option 2. Different inventory at new division.

Item numbers for the merchandise at the new division must be created. Go to:

Inventory (Module 5)
- Add New Items (Task 1)
  - Enter (ADD) New Items (Sub-task 1)

See the document titled: Add New Items for complete instructions, if needed.

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TABLES / PARAMETER FILES AND OTHER MISC. SET‑UP

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General Ledger:

Enter the new division number, with address and phone number. i.e. Division 02. Go to:

General Ledger (Module 4)
- Division Master (Task 21)
  - Enter New Division Record (Sub-task 1)

Purchase Order:

Add a new location/warehouse record for the new division. i.e. Division 02. Go to:

Purchase Order (Module 7)
- Location/Warehouse Addresses (Task 20)
  - Enter New Loc/Whs Record (Sub-task 1)

Identify which terminals do purchase orders for the new division. Go to:

Purchase Order (Module 7)
- System Management Functions (Task 32)
  - Modify Application Tables (Sub-task 17)
    - Terminal/Warehouse Cross Reference Table (Option 5)

Set table as desired. When doing a purchase order, this indicates by terminal, which warehouse is doing the ordering.

Terminal Division

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"TERM01" , "01"

"TERM02" , "02"

"TERM03" , "$$"

NOTE: Using $$ as division number will cause the system to prompt the operator to enter the division number.

Accounts Receivable:

Specify the payment policy that A/R task 2. "Cash/Receipts Entry and Editing" should follow for the new division. Go to:

Accounts Receivable (Module 2)
- System Management Functions (Task 32)
  - Modify Parameter Files (Sub-task 22)
    - A/R ‑ General (Option 1). Look for the following parameter:
    - DIV'FLAG=D (the flag controls the displays of A/R open documents in A/R task 2)
      - N=no division control
      - D=display division of each account (no restrictions) (a D will allow a payment to be applied to an open order from any division)
      - F=force A/R open document division to match division on first screen. (an F will not permit a payment received in one division to be applied to an open order from another division)

Unless there is a reason for restricting how payments can be applied to open orders, we recommend assigning DIV'FLAG=D because customers generally pay all invoices with one check regardless of where the purchase was made.

Specify if the assets posted to the G/L Balance Sheet should be separate by division or consolidated into division 01.

Consolidated Balance Sheet posts all assets from all divisions to division 01.
Divisional Balance Sheet posts assets to each division separately.

Go to:

Accounts Receivable (Module 2)
- System Management Functions (Task 32)
  - Modify Parameter Files (Sub-task 22)
    - Interface (Option 3) Look for the following parameter:
      - BAL'SHEET'FLAG=C
        
        C=Consolidates the balance sheet; forces A/R assets, receivable, tax, freight, etc. to be posted to division 01. (This is the recommended setting.)
        
        D=Division balance sheet.

Inventory Control:

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Specify the highest division (warehouse) in use. Go to:

Inventory Control (Module 5)
- System Management Functions (Task 3)
  - Modify Parameter Files (Sub-task 22)
    - I/C ‑ General (Option 1) Look for the following parameter.
      - DFLT'WHS'NUM=2 Set to highest warehouse/division in use. (If there are only two divisions, enter 2)

Order Processing:

Tell the order entry program which terminals should default to the new division (warehouse). Go to:

Order Processing (Module 6)
- System Management Functions (Task 32)
  - Modify Application Tables (Sub-task 17)
    - Default Terminal Warehouse/Dept's (Option 7)

;Terminal whs dpt

;======== === ==

;TERMxx" , "xx.xx"

"TERM01" , "01.01" (the 01 of TERM01 is the division #)

"TERM02" , "$$.$$"

"TERM03" , "02.01"

This sets the default division/warehouse number and department number that default on the first screen in

Order Entry. The terminal number controls this. Set as required.

NOTE: Using $$ as division and/or department number will cause order entry to prompt the operator to enter the division number.

Tell order entry which departments are available in the new division.

Order Processing (Module 6)
- System Management Functions (Task 32)
  - Modify Application Tables (Sub-task 17)
    - Available Warehouse/Dept Combinations (Option 15)

whs dpt Department name

== == ============

"01.01" , "Counter sale" (the 01 of 01.01 is the division #)

"01.02" , "Accessories "

"01.03" , "Service "

This sets which warehouse/division and department combinations can be used in order processing.

3. Tell order entry the formula for deciding which G/L account numbers to use for sales and cost of sales.

Order Processing (Module 6)
- System Management Functions (Task 32)
  - Modify Parameter Files (Sub-task 22)
    - O/E General (Option 1) Look for the following parameter:
      - ACT'DST'FLAG=DIV distribution format for G/L sales and cost of sales accounts.
      - NOR=Normal. middle digits not changed
      - DEP=Dept. middle digits set to dept.
      - DIV=Division.
        
        ‑If DIV: Transfers set middle digits to destination division.
        
        -If DIV: Non‑transfers set middle digits to 00.

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TAX ZONES

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For a comprehensive overview of tax zones see the separate document entitled: "Task 23 - Tax Zones".

Step 1. Add new tax zone numbers for any new tax rates that order entry might be expected to apply beyond the normal state tax rate. Go to:

Accounts Receivable (Module 2)
- Tax Zones (Task 23)

If a tax zone number is added for 1 division, then you MUST add the same tax zone number for every other division.

If the other divisions do not use the new tax zone number, then they should be added with a tax rate of zero.

Step 2. For pickup and will call orders, provide appropriate tax zone numbers to "Pickup tax A, B and C" for the new division. Go to:

General Ledger (Module 4)
- Division Master (Task 21)

A tax zone number must be assigned to Pickup tax A, B and C.

Set unused tax zones to 99999 Normal customer tax. This tells order entry to use its existing tax zone number (which will probably be 00000 No tax) for this tax zone.

Example: if you want all pickup orders sold in division 2 to add a zone tax on top of the state sales tax then set the division 2 record to these values:

10. Pickup tax A:00555 County tax

11. Pickup tax B:99999 Normal customer tax

12. Pickup tax C:99999 Normal customer tax

Step 3. For delivery and ship‑to orders, be sure to set appropriate tax zone numbers in the customers added or changed in the following tasks:

Accounts Receivable (Module 2)
- Customer Master (Task 17)

Order Processing (Module 6)
- Alternate Ship‑to File (Task 19)