We are selling a product for time and materials and are collecting time spent by our Engineers and Management staff that are normally not added to COGS.  Does anyone else do this and if so can you tell me how you accomplish it?  
My solution so far is to create a work center and a sequence without any labor costs so that direct labor is not absorbed.  That way we can at least collect time spent by engineering and management. But wiht no costs the margin will be overstated.  
Any help would be appreciated!

Cathy,  one method is to open an "Indirect" project work order with a sequence to capture labor and possibly a sequence to capture outside costs as well.  Have all those employees whose labor hours you want to collect (note: you can use actual employee labor rates or capture hours and use composite rate from the work center for which the sequence(s) are assigned).  This way, all labor and or purchase costs are accumulated within this project work order.  When done, do a WO-H: Enter Misc/Extra Costs for a minus (negative value to an expense account or COGS).  The work order can then be closed and the costs sent to the proper expense.  Take a look and see if this will work for you.  I have used successfully in the past.
 
Dennis

Thanks, everyone, for your input!!
 
Here is what I have come up with:
We are producing a prototype and are charging for time and materials.  We have management level and R&D people working on this as well as our direct labor people.  So while we want the direct labor absorbed as usual, we do not want the other hours to be absorbed that way( as direct labor).  I thought of making a labor part number ( with a class code that puts absorbed labor in , say, the R&D expense account) that we could use to issue hours to the prototype work order, but the reporting is not as clear as the labor sequence report for our purposes, so I went with a work center  with no labor cost and a sequence using that work center.  This works for us as far as the producing a document that shows the hours worked by each group, (by assigning a sequence for each group).  If we want to add costs to the work order we can do an adjustment as Dennis suggested by taking the number of hours reported and using a $$ multiplier for each group to enter Misc/extra costs in WO-H.
 
Thanks again for responding --