Profit Centers and Departments

Profit Centers can help a company track the profitability of specific areas within a company.  They can be a good way to handle multiple product lines as they allow a company to produce an income statement by profit centers.  These are generally established before entering the General Ledger accounts

Departments can be used to allocate expenses, for example, between Administration, Operations, and Marketing. These categories can be grouped by department for financial reporting.

TABLE OF CONTENTS

• Company Set Up Options
• Setting up Profit Centers
• Setting up Departments
• Reporting Using Profit Centers and/or Departments
  • Income Statement
  • Trial Balance
• Account Grouping

Note: If you have existing GL accounts, and want to use either of these options, you will need to create new accounts. Existing accounts cannot be modified to include profit centers or departments.

Here is an example of the different options that can be used.

50550-00-00  Hydro (All company)

50550-10-00 (Hydro for the Profit Center "10", with no department)

50550-00-20 (Hydro for the Department "20", with no profit center)

50550-10-10 (Hydro for the Profit Center "10" and the Department "20')

Company Set Up Options

You will need to check these options in the Company Set Up window, under Options.  

Setting up Profit Centers

NOTE: The profit center number appears as the middle two digits of the G/L account number.

1) Select Setup from the G/L menu and choose Profit Centers. The Profit Centers window appears.

2) Click Add.

3) Enter the Profit Center No. The Profit Center number must be a two-digit number. 

4) Enter a Profit Center Name. The name can be 25 characters in length and will appear in the pop-up list when entering G/L accounts.

5) Press ENTER or click the green checkmark to save the information.

6) Click the Print icon while in the Profit Center window to generate a report listing all available Profit Centers.

Setting up Departments

NOTE: The department number appears as the last two digits of the G/L account number.

1) Select Setup from the G/L menu and choose Departments. The Departments window appears.

2) Click Add.

3) Enter the Department N°. 

4) Enter the Department Name. This name will appear on the Department pop-up list when entering G/L accounts.

5) Press ENTER or click the green checkmark to save the information.

6) Click the Print icon while in the Departments window to generate a report listing all available Departments.

Reporting Using Profit Centers and/or Departments

The following reports can be run using Profit Centers and Department filters

Income Statement

Trial Balance

Account Grouping

Users may find it cleaner on financial reports to group some profit and department accounts in a specific way. Here is some information on Account Grouping and how it works

Account Grouping