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Thread: Costing salaries and expenses between companies

  1. #1
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    Costing salaries and expenses between companies

    Good day All,

    Can someone please help with the following two matters:

    I have a situation where I have registered two separate company, call them Trade1 and the other Logistics2
    Trade1 sells goods but does not transport
    Logistics2 does the transport to customers.

    1. Costing or allocation of Salaries
    Myself and another manager work in both companies but we both only get paid by our salaries by Trade1 (50% of time is spent on Trade1 and 50% on Logistics2)
    We would like to know how to cost the time spent as percentage of salaries, meaning Trade1 recovers 50% of the salaries cost from Logistics2

    2. Costing Van / Truck rental
    Logistics could not get all the finance or rental it needed to get the right number of trucks as it was a new business with no history
    So, Trade1 financed a Van/ Truck in the name of Trade1 and is paying the bank monthly
    How do we cost that as an expense in the books of Logistics2? We do not want to do a loan as a loan does not reduce operating expenses

    Thank you all

    Best regards
    Sabatha

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    Can someone please help

  3. #3
    Site Caretaker Dave A's Avatar
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    Quote Originally Posted by SSS100 View Post
    1. Costing or allocation of Salaries
    Myself and another manager work in both companies but we both only get paid by our salaries by Trade1 (50% of time is spent on Trade1 and 50% on Logistics2)
    We would like to know how to cost the time spent as percentage of salaries, meaning Trade1 recovers 50% of the salaries cost from Logistics2
    I raise an admin fee invoice. It's income in the one company and an expense in the other.

    Quote Originally Posted by SSS100 View Post
    2. Costing Van / Truck rental
    Logistics could not get all the finance or rental it needed to get the right number of trucks as it was a new business with no history
    So, Trade1 financed a Van/ Truck in the name of Trade1 and is paying the bank monthly
    How do we cost that as an expense in the books of Logistics2? We do not want to do a loan as a loan does not reduce operating expenses
    Put a rental agreement in place between the two entities and have Trade1 rent the van to Logistics2.
    The trouble with opportunity is it normally comes dressed up as work.

  4. Thank given for this post:

    flaker (26-Oct-15), SSS100 (25-Oct-15)

  5. #4
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    Thank you Dave,
    will send pm for info

    Enjoy your day

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