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Former Member
Jun 02, 2014 at 02:53 PM

Setting of Cost Element category


Hi Experts

I have a query around whether to set particular accounts as Primary Cost Elements or Revenue Cost Elements.

We are a financing business and generally split our P&L into Income, Expenses and Bad Debt. Currently all cost elements under Bad Debt are defined as Primary Cost Elements but this means that the business need to enter a cost centre when posting to the accounts.

The business have argued that they do not need to analyse Bad Debt by cost centre - simply by Profit Centre, along with Income.

Can you tell me:

  • Is it possible / advisable to change the Bad Debt cost elements from being Primary Cost Elements to being Revenue Cost Elements?
  • What are the implications if we make this change?