CenterPoint® Accounting for Agriculture - Recording Commodity Wages in CenterPoint

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Commodity Wage Transaction Video - Duration: 7 min 59 sec

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Document #: 3222 Product: CenterPoint® Accounting for Agriculture

Commodity wages is an example of a non-cash transaction where crops are given to employees in lieu of wages. This is sometimes also referred to as "in kind wages". The farm needs to record this as a sale that is applied to the labor expense account. After recording a commodity wage transaction, the reports will include the revenue to the farm for the sale of the crop and the expense for wages.

Step A - Create a Commodity Wage template (one-time setup)

Step B - Enter a Commodity Wage Transaction

Step A - Create a Commodity Wage Template (one-time setup)

  1. Select Setup > General > Data Entry Templates.
  2. Select the template DT – Sell Raised Inventory and click Copy.
  3. In the New field enter a title such as Commodity Wage.
  1. Change the Type to General Journal.
  2. Select the option “Make available as a Special Process”.
  3. Select the Detail tab.
  1. In the Journal Entry Detail area on the left, select Bank.
  2. Change the Journal Name on the right to Expense.
  1. Change the Expected Account Type to Expenses.
  2. The original Bank journal will now be listed on the left as Expense. Expand the journal by clicking on the + found to the left.
  3. Select Account under Expense. On the right, change the Type to Choose From a List.
  4. Enter Labor Expense Account in the Caption field.
  5. Click on the green filter button to the right of the Property to Use field.
  1. In the next screen, select Account Types in the upper left.
  2. In the list of types on the right side of the screen, move Expenses from the Available box to the Selected box, using the green arrow button.
  3. Click Add Filter, and then click OK.
  4. Skip to step 23 if you are not tracking production details.
  5. If you are tracking production details, they can also be added to the labor expense if desired. Select Profit/Cost Center under the Expense journal.
  1. Select Copy in the Type field and Income in the Journal Entry Items box.
  2. Select Production Year under the Expense journal.
  3. Select Copy in the Type field, Income in the Journal Entry Items box, and then click Save.

Step B - Enter a Commodity Wage Transaction

  1. Select Processes > Special Transactions.
  2. Select Commodity Wage in the Process Template field.
  1. Enter the Company.
  2. In the Name field, select the employee.
  3. The Transaction Type defaults to General Journal (Accrual). If want this transaction to be included in tax reports, change the Transaction Type to General Journal (Cash/Accrual).
  4. Select your Labor Expense Account, and specify the quantity of crops given in the Quantity 1 field.
  5. Select the appropriate Inventory and the appropriate crop sale revenue account in Income Account.
  6. Enter the value of the sale/wage in the Amount field.
  7. On the right enter any production details for the sale.
  8. In the Memo Line 1 box, enter an optional memo for the transaction. In the Line 2 box, if the transaction is assigned a name that was setup with a default memo, it will display automatically and can be overridden.
  9. Click Save.

Document: 3222

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