Refer to attached document "cost_based_billing.pdf" for more information on cost based billing.

1. Generate WIP
   Generate Work-In-Progress (Tasks menu) is used to apply rates and markup calculations to cost transactions received from Accounts Payable, Equipment Cost, Job Cost, and Payroll for billing purposes. Work-In-Progress (WIP) records created for cost-based billings are stored in the Unbilled.BLW file.
2. Generate Cost Base Invoice
   The following records are created during the Generate Cost Based Invoice task:
   • Invoice—stores the total amount of the invoice.
   • Section—stores the total amount of each section (cost type) and invoice total add-on for the invoice.
   • Section Detail—stores the Work-In-Progress totals by contract item for each section on the invoice.
   • Add-on—stores the add-ons associated with each section and invoice total add-on for the invoice.
   • Sales Tax—stores the sales tax for the invoice.

Items calculated during the Generate Cost Based Invoice Task:

• Add-ons are calculated during Generate Cost-Based Invoices for cost-based invoices.
• Billing calculates the amount of retainage held on a cost-based invoice when you generate invoices from the Generate Cost-Based Invoices task. It retrieves the retainage percentage from the contract item (Billing tab) in Contracts and applies it to the Work-In-Progress, Add-on, and Sales Tax totals.
• Billing calculates taxes when generating cost-based invoices if the Tracking taxes check box is selected in AR Settings (in Accounts Receivable, File, Company Settings, AR Settings).
  Note: Billing retrieves the exempt status for a contract item to determine whether taxes need to be calculated. For each taxable work-in-progress (cost-based) entry, Billing calculates a tax amount during the Generate Cost-Based Invoices task. It retrieves the tax group by amount type from the contract item (Tax tab) in Contracts. The tax group provides tax rates for the tax calculation. If no tax group has been entered for an amount type, it uses the Total billed tax group.