Expense and Revenue Distribution Templates

Expense and Revenue centers provide a logical framework that enables businesses to act as a business unit, branch office, or department and calculate income-expenses and profit-losses. Businesses buy a lot of goods and services, employ people, and spend money. Likewise, it produces and sells products-services and generates income. All income and expenses are classified under budget items and a measurement-monitoring criterion is created for the enterprise. In Workcube, each purchase-sale and each expense has a budget item. Expense templates are used when a large number of periodic general-purpose expenses are desired to be distributed to all units of the enterprise. For example, electricity, internet bills are recorded as a single transaction and a total expense. However, the distribution of these invoices to the units of the enterprise should be followed by which expense and income center received how much from the general expenses.

How can we distribute general-purpose expenses such as Electricity, Water, Internet, Kitchen-Cleaning, Building Maintenance, Rent?

You can group a total expenses as a single transaction by proportioning it according to expense centers, departments, and activity types. The following keys can guide this proportioning process.

• Ratio by Area: Find out which department uses how many square meters of space in the office, compare it to the total area and distribute the expense to the expense center as a %. This approach works well in the distribution of expenses such as rent, maintenance, electricity cleaning.
• Ratio Per Employee: Find out how many people work in each department and rate it by the total number of employees and allocate the expense to the expense center as a %. This approach works well in the distribution of expenses such as kitchen, internet, communication.
• Special Ratio: Any expense can be proportioned depending on business dynamics. For example, while the sales unit covers 70% of the advertising expenses, approaches such as distributing the remaining 30% slice equally to other units can be used.

Can revenues be distributed through templates?

An enterprise's profit centers may exhibit internal customer behavior among themselves or may apply a revenue-sharing model. The lifeblood of businesses is sales. Mostly, central selling units write all of the income from sales as income to their profit center. But they cannot make the sale alone, there are many units supporting them. In this case, it becomes difficult to follow the income and expenses of these units on the budget. A revenue-sharing approach can then be used to other business units-profit centers that support the sales unit.

For example, the sales unit creates its own income by taking a 10% share from each product and service sold and distributes the income from sales to the units that produce the products and services while balancing its expenses within this income it receives. This type of calculation is a calculation that changes according to the cost structure of the enterprise and the functions of the business units. It should be done carefully according to the operating dynamics and should be checked periodically according to the changing conditions.

When a product invoice associated with the "Data Center Revenue Distribution Template" is issued, Workcube will automatically distribute the budget according to the above key. Thus, revenue sharing will be made between the supporting units or the units that own the product or service. The main purpose of this approach is to ensure that all units behave like a business.