Indirect Labor and GL

Kinetic ERP
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1

TLDR
Is there a way I can still track the time spent on Indirect Labor Codes without it hitting the GL? Like maybe if I setup the Expense Code a certain way?

This might be a noob question but we recently started reporting labor on jobs in one area of our factory using time and quantity method (employees actually clock in and out of jobs). We are now costing those jobs based on the actual time spent on the job. We like this.

This led to a question about where the time goes that an employee is on the clock at work but not punched into a job. So we started capturing Indirect Labor thinking that would fill in the blanks. But what I did not realize is that is showing up on the GL. We don’t typically put that kind of cost into our GL as it’s already accounted for elsewhere in our factory overhead expenses. Is there a way I can still track the time spent on Indirect Labor Codes without it hitting the GL? Like maybe if I setup the Expense Code a certain way? I’m in unfamiliar waters.

2

When you create the Expense Codes you can assign a GL Control of type Indirect Labor. I believe if you set the Applied Labor and COS Labor account contexts on that GL Control to the same account, any GL transactions that are created will offset for $0 net effect. I think Epicor won’t even post anything to the GL if you have the COS/WIP posting rule set to summarize.

In our case, we have the credit portion of the GL transaction offset our direct labor applied account and charge an Indirect Labor account. This reflects the cost of having direct floor employees doing indirect work for us.

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That makes sense to me. And I can see why we might want to have it as two separate accounts. We just aren’t currently setup that way. But the goal is the same. We want to minimize “skilled” labor spending time doing things that a general laborer could do.