Brief Accounting Knowledge Base/Time & Billing

Hard Costs vs. Soft Costs

Chris - Brief Accounting
posted this on July 08, 2010 12:49

In general, a hard cost is a disbursement you pay directly to a vendor on behalf of a client; soft costs are intangibles incurred on behalf of the client. A hard cost would be for items such as filing fees, court reporters, etc. Soft costs are items such as postage, long distance telephone calls, facsimiles and photocopies.

 

In order to separate Hard Costs (costs advanced) and Soft Costs (office costs such as photocopies, etc.) on reports in Brief Accounting, you must classify them as such on the Disbursement Slips when they are entered.

 

Hard Costs should be assigned a GL number between 4501-4699 (Default 4501).

Soft Costs should be assigned a GL number in the range 4701-4999 (Default 4701).

 

It would be a good idea to setup Disbursement Codes for all the common costs and assign the default GL number you want to use for each code. You can then start using codes whenever you can when you enter new cost slips.

 

GL 4701 should be setup in already in Brief Accounting. If it is not you can create the GL account. If it isn't however you cancreate it.

 
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