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Overview
AdMagic Ad Magic uses the Royalty module to calculate the royalty payable to designers. The royalty is calculated for every designer, based on the Sales Channel of the sold items.
Setup
Set up Designers as Salesforce Accounts
Owned or Consignment???? By Order????
Set up Royalty Rate by Item, Designer/Vendor, and Channel Type
Set up a service item for Purchase Invoice
Update Company Setup ‘Royalty Payment Service Item’ field to link to this service item.
Royalty Rate Setup
Game - : Designer’s game (Item)
Designer/Account/Vendor - Designer/Vendor accountSales Channel - Pickst list with values “Retail” and “Wholesale”: Points to the Account table.
Sales Type: A picklist with the values “B2B” or “B2C”
Values are from Total Sales.
Total Sales defaults Channel Sales Type to Retail “B2C” when sales orders Sales Orders are from Shopify. If it’s not from Shopify, Wholesaleit will default to “B2B”.
Ad Magic has a routine to create GF Sales Orders from Total Sales. The routine also populates must populate the Sales ChannelType field.
If a Sales Order is created manually, the Channel Sales Type defaults to wholesale “B2B” but can be changed.
Rate Type: A picklist with values “%” or ”Unit”
Rate - Numeric field represents % if Rate Type is ‘Percentage’, $ Amount if Rate Type is ‘Fix Amount per Unit.
Rate Type - Picklist with values: “Percentage” and ”Fix Amount per Unit”
Unit COGS - :
The numeric field will be a percentage if the Rate Type is '%’
The numeric field will be the $ amount per unit if the Rate Type is ‘Unit'.
Unit COGS: Cost of goods sold per unit.
Deduct COGS - : If Checked, the system will deduct the total cost of goods sold (COGS * Invoiced Qty) from the royalty amount.
...
Royalty Calculations
Navigate to Royalty Calculation
Click the “Calculate Royalty” Calculate Royalty button
Month End defaults to the previous month’s last date.
System will:
Gather all games (items) with a royalty rate setup
Retrieve all Sales Invoice Lines with the following criteria:
Sales Invoices' Document Status = Posted
Item gathered in step a
It does Items that are set up in the Royalty Rate Setup table
The invoice lines do not have a Royalty Calculation Line linked
Posting Date <= the Month End date
Each unique combination of Year/Month and Designer account , the Designer Account and GL Ledger will have a Royalty Calculation header????.
Royalty Amount calculation logic:
Line COGS = Invoiced Qty. * Unit COGS
If Deduct COGS is checked:
Then Royalty Amount = Royalty Amount - Line COGS
If Royalty Rate’s Rate Type setup is “Percentage” “%”:
Then Royalty Amount = Sales Amount * Rate / 100
If Royalty Rate’s Rate Type setup is “Fix Amount per Unit” “Unit”:
Then Royalty Amount = Royalty Amount - Line COGS
Line COGS field in the Royalty Calculation Line object is calculated using COGS in the RoyaltyThen Royalty Amount = Invoice Invoiced Qty. * Rate
If Deduct COGS is checked and the Unit COGS field is not blank in the Royalty Rate setup
Rate
* Invoice Qty.
Multiple Royalty Calculation Lines will be created if more than one designer
is set up to receive
royalty payment for one particular item in the Royalty Rate Setup table.
Users need to review and pay.Manually enter Royalty Payments. (Automation is possible)
Ad Magic reviews and then pays the Remaining Payment. (Automation is possible)
Fields List
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: Royalty Calculations
Field Name | Field Help |
|---|---|
Designer/Account/Vendor | Lookup to |
the Account table | |
Royalty Amount | Roll-up summary of Royalty Amount from Royalty Calculation Lines |
Payment Amount | Roll-up summary of Payment Amount from Royalty Payments |
Remaining Payment | Formula field: Royalty Amount - Payment Amount |
End of Month | Last date of the month |
Year/Month |
TEXT(MONTH( End_of_Month__c)) + '/' + TEXT(Year( End_of_Month__c))
...
For example, 2023/08 | |
GL Ledger | GL Ledger from Sales Invoice |
No. of Lines | Number of Royalty Calculation Lines created |
Fields List: Royalty Calculations Line
Field Name | Field Help |
|---|---|
Royalty Calculation | Master-Detail(Royalty Calculation) |
Sales Amount | Sales Invoice Line’s Line Amount |
Sales Type | Sales Order’s Sales Type |
Invoiced Qty. | Invoice Line Quantity |
Rate Type | Picklist with values |
“%” and “Unit” that determine type of rate in the Rate field |
Rate |
The numeric field represents percentage if Rate Type is |
'%’ or $ amount per unit if Rate Type is |
Line COGS
Line total cost of good sold, 0 if “Deduct COGS” is not checked for the matched Royalty Rate setup, otherwise COGS = Invoice Qty. *Unit COGS in Royalty Rate setup.
Royalty Amount
IF(TEXT(Rate_Type__c) = 'By Percentage',Sales_Amount__c * Rate__c / 100 - Line COGS__c, Invoiced_Qty__c * Rate__c - Line_COGS__c)
...
‘Unit'. | |
Unit COGS | Copied over from matched Royalty Rate Setup when line is created. |
Deduct COGS | Copied over from matched Royalty Rate Setup when line is created. |
Line COGS | Line COGS = Invoiced Qty. *Unit COGS |
Royalty Amount | See above Royalty Amount calculation logic, |
Security
Only users who are allowed to access Accounting Seed can access the Royalty Calculation module.
Create Purchase Invoices
Navigate to Royalty Calculation
Click the Create Purchase Invoices button
‘Month End’ defaults to the previous month’s last date.
System will:
Retrieve all Royalty Calculation Lines with the following criteria:
The Royalty Calculation Lines do not have a Purchase Invoice Line linked
End of Month <= the Month End date
Get Division from the Sales Invoice Line. The system will use the Division from the Sales Invoice if the Division is blank on the invoice line.
Each unique combination of Division, Year/Month, and Designer account will have a Purchase Invoice.
Navigate to the Purchase Invoices page to review the newly created Purchase Invoice under the “Open Royalty Payment” list view.
After the purchase invoice is posted, it will appear under the ‘Posted Royalty Payment’ list view.
Royalty Payments
Create Vendor Payments every quarter.