Scenario: Segmenting Revenue & COGS at the Product Sub-Category Level

Separating your revenue / cost of goods sold at a sub-category level provides for the most practical detailed level for revenue segmentation. Most ConnectWise partners might find that segmenting at "Category" level would provide enough separation for product sales. 

For this example we will provide the most detailed, to demonstrate how this information is to be managed.


  1. Log into your xero organisation and from the top menu click on: Settings > General Settings > Chart of Accounts
  2. Select the "Chart of Accounts" item on the page.
  3. Click on the "Revenue" and "Expense" tab at the top of the list.
  4. Take Note of the following accounts details for each account required:
    1. Code
    2. Name

Example information to collect (based on xero screenshot above):

Account TypeRevenue Segmented atCategoryRevenue AccountCOGS Account
Revenue-ProductProduct Sub CategorySales - Infrastructure4-20105-2010
Revenue-Product
Product Sub CategorySales - Desktop4-20115-2011


In this scenario, understanding how a product is structured is important. 


  

  1. The ConnectWise Product Item screenshot shows the Category / Subcategory separation.

  1. Based on our mapping table above is would output to xero to the following accounts:
    • Revenue when Sold: 4-2011
    • Expense when Bought: 5-2011


Record your information for each of the following system accounts:

Depending on the level of segmentaion, the following table should be copied to a spreadsheet for ease of entry and reference. As the process must be completed through the connectwise interface, it pre-planning your mapping will save a lot of time flipping between applications (ConnectWise / xero)


Account TypeTableRecordRevenue AccountCOGS Account
Revenue                                                                                                                                                                                
Revenue-Product




Revenue-Agreements




Revenue-Agreements Products




Revenue-Expenses