Configuring Budget Allocations in Microsoft Dynamics 365 Finance

Allocation Methods for Budget Plan Distribution

Question

You work as the Finance Director for a company.The company uses Microsoft Dynamics 365 Finance for its accounting system.

The company has several financial dimensions and an organizational hierarchy configured for budgeting.

You are configuring budgets within the organization.You need to configure the correct allocation method to distribute the data in a budget plan to accurately portray the projected amounts.

You need to determine which allocation method to use to allocate budget plan lines from the source budget planning scenario to lines in the destination scenario, based on the percentages and financial dimensions that are defined in a selected budget allocation term.

Which of the following allocation methods meets the requirement?

Answers

Explanations

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A. B. C. D.

C.

https://docs.microsoft.com/en-us/dynamics365/finance/budgeting/budget-planning-data-allocation

In Microsoft Dynamics 365 Finance, budget planning can be done using the Budget planning workspace. This workspace allows users to create and manage budget plans using different budget planning scenarios, which can then be compared and analyzed. One important aspect of budget planning is the allocation of budget amounts to different financial dimensions and organizational hierarchies.

To allocate budget plan lines from the source budget planning scenario to lines in the destination scenario, based on the percentages and financial dimensions that are defined in a selected budget allocation term, you need to use the "Allocate to dimension" allocation method. This allocation method is used to distribute a source value to multiple destination values based on percentages and dimensions defined in the allocation term.

Here's how the "Allocate to dimension" allocation method works:

  1. You start by defining an allocation term. An allocation term is a set of rules that defines how a source value is allocated to multiple destination values. You can define the percentage of the source value that should be allocated to each destination, and you can also define the financial dimensions that should be used to allocate the value.

  2. Next, you create a source budget plan scenario. This scenario contains the original budget amounts that you want to allocate.

  3. You then create a destination budget plan scenario. This scenario contains the budget amounts that will receive the allocated amounts from the source scenario.

  4. You then run the allocation process. During the allocation process, the system uses the allocation term to allocate the source amounts to the destination amounts based on the percentages and dimensions defined in the allocation term.

  5. Finally, you can review and adjust the allocated amounts in the destination scenario to ensure that they accurately reflect the projected amounts.

In summary, the "Allocate to dimension" allocation method is used to distribute a source value to multiple destination values based on percentages and dimensions defined in an allocation term. This method is useful when you need to allocate budget amounts to different financial dimensions and organizational hierarchies in a precise and accurate manner.