Charging Warranty Work Directly to the Warranty Account

To accurately track warranty work and ensure proper financial management, you should charge warranty jobs directly to the warranty account rather than general sales ledger accounts. This can be achieved by setting up the warranty company as a sales ledger account and configuring the ledger categories appropriately.

Steps to Set Up the Warranty Account

1. Create a Sales Ledger Account for the Warranty Company:

   • Navigate to Sales Ledger > Add New Account.

   • Enter the warranty company's details and assign an appropriate account code.

   • Save the entry to add the warranty company as a sales ledger account.

2. Charge Warranty Work to the Sales Ledger Account:

   • When processing a warranty claim, allocate the invoice directly to the warranty sales ledger account.

   • Ensure that all warranty-related transactions are booked under this account for accurate tracking.

Configuring Sales Ledger Categories for Better Income Stream Monitoring

To keep warranty-related transactions distinct from standard sales ledger accounts, it is recommended to create dedicated sales ledger categories. This will allow you to generate an extended sales ledger control nominal, which can be mapped to "Other Income" in the management accounts.

To find out how to do this, go here and read more. How to Add Nominal Categories to the Purchase and Sales Ledgers