For a project, you must collect costs that you can charge to recover expenses and generate revenue. To do this, you must define and categorize expenditures such that costs for the project can be calculated during the cost distribution process. You use expenditure categories and expenditure types to group expenditures for costing and billing. For expenditures that you import, you must define the transaction source.

• Expenditure categories
• Revenue categories
• Expenditure types
• Non- Labour Resources
• Transaction sources

Notes Non-labor costs are calculated either by expenditure type or by non labor resources.
You can enter the cost rate either in expenditure type or in non labor resource.  If you enter cost rate in an expenditure type then system would consider the same rate for all the operating units but if you want to put different cost values in different operating unit then create a non-labor resource and attach it to the expenditure type. You can attach different cost rates in different OUs to the same non-labor resource.
         

Expenditure Category

You define an expenditure category to group the types of costs incurred by your organization. For example, an expenditure An expenditure category describes the source of your organization's costs. For example, an expenditure category with a name such as Labor refers to the cost of labor. An expenditure category with a name such as Supplier refers to the cost incurred on supplier invoices.

You use expenditure categories when you define organization overrides, for budgeting, and for transaction controls. In addition, you can use expenditure categories in your AutoAccounting rules and in your reporting. Expenditure categories are used for grouping expenditure types for costing.

Example:
Expenditure Category Name - Description
Labor - Labor costs
Travel -  Travel expenditures
In-House Recoverables - Use of corporate assets
Outside Services - Outside services
Material - Materials
Other Expenses - Expenses, excluding travel

Revenue Category

You define a revenue category to group types of revenue generated for your organization. For example, a revenue category of Labor refers to the revenue earned as a result of the work done by people resources.

Example:
Revenue Category Name - Description
Fee - Fee Earned
Labor - Labor Revenue
Other - Non-Labor Revenue
Payment - Payment

Units

A unit of measure records quantities or amounts of an expenditure item. You assign a unit to each expenditure type. For example, you can specify the unit of measure Miles when you define an expenditure type for personal car use. You enter the quantity of personal car use in miles, and Oracle Projects calculates the cost of using a personal car
by mileage.
If you want to calculate the cost of computer services by the amount of time a user uses a computer, you can define an expenditure type for computer services and assign it the unit Hours.
Oracle Projects predefines the units Currency and Hours.

To define a unit of measure:
1. Navigate to the Unit Lookups window.
2. Enter the following information for the unit.
• Code
• Meaning
• Description
• Tag Value (optional -- tag value is not used by Oracle Projects)
• Effective dates
3. Save your work