In case expenses are allocated to Cost Centres, then those allocations need to be moved to other Cost Centres before deleting the Cost Centres. To disable the Cost Centres, you need to delete them. In case you do not want to use Cost Centres, you can disable them as well. In TallyPrime, you can view the reports that help you to track income and expenses that are incurred Cost Cen tre-wise.
For each department separate Cost Centres are created to consolidate the expenses incurred and incomes created by all employees in the department. Each employee is represented by a Cost Centre. In the following diagram, you can see how an organisation uses Cost Centres to track their expenses and incomes. You can also allocate the same income or expense to different sets of Cost Centres in parallel, say employee-wise as well as project-wise, for reporting purposes by using Cost Categories for the respective Cost Centres. Further, you can create Cost Centres with employee names under projects where employees from different departments work or the same employee works on different projects. While viewing the report you can view the hierarchy of the Cost Centres under the Cost Category. For example, you can create Cost Centres like Sales Department, Marketing Department and so on. Such Cost Centres can be created in a hierarchical structure to get a consolidated view of the allocation. You can have multiple Cost Centres or Profit Centres in your company, as needed, and allocate the breakup of incomes and expenses to different Cost Centres or Profit Centres.
TallyPrime makes it easy for you to track the expenses and profits made by your company. You can maintain your incomes and expenses, as per different business units, employees, projects, departments, and so on, using the Cost Centre capability in TallyPrime. These details help you to decide the action to be taken at the right time. This helps you to understand which department is incurring more expenses or which department has generated profit. In any organisation, it is crucial to keep track of expenses incurred and the profit earned by each department. While recording the transaction, once you select the Cost Centre Class, automatically the expenses and incomes get allocated to the respective Cost Centres based on the percentage of allocation defined. You can also create a Cost Centre Class with the Cost Category and Cost Centres along with the predefined percentage allocation. For example, with parallel allocation, you can view the allocation of Travel expenses incurred by an Employee and for any Sales schemes. You can view the same expense allocation between the Cost Centres of two Cost Categories through parallel allocation. Along with Cost Centres, you can create a Cost Category and use them in Cost Centres for parallel allocation. You can create Cost or Profit Centres and allocate expenses and incomes to them. In any business, the Cost Centre or Profit Centre plays an important role in tracking the expenses incurred and profit earned by each department.
#Profit first allocation percentages pdf#
PDF Cost Centre or Profit Centre Allocation
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