We manufacture goods under licence from other manufacturers.  We then pay a royalty based on the sale value of those goods.  I've always run sales analysis (SA-M) to pick up those sales, accrue for the cost in the GL and let the designer/manufacturer know what we've sold.  That works for the most part, as the cost of the royalty is reflected at a company wide perspective, but on looking at the margins by item code in sales analysis (SA-M), the cost of that royalty is not reflected.  Ideally I would like to have that cost reflected in the bill of materials or routing to clearly reflect the cost of sale in the item.  I'm considering creating a non-stock item in the bill of materials that adds to the cost of inventory (and cost of sale), and creates an accrual to my balance sheet for that value.  But the problem with that would be that each item we sell will have a different royalty value, and would a non-stock item even create that transaction in the first case?  Alternatively I could create an outside process in the routing that would add the value to the cost of the manufactured item.  But then we would have to create a Purchase Order and receive it in.  That might work, in that it would create a RNI liability that I could key an invoice to.
 
Does anyone have any other suggestions, or deals with royalties to other manufacturers?

Thanks, I'll have look at that in our test system and see if creating a Royalty Employee and cost centre would work.  I do want to minimise actions taken by manufacturing staff as I'm not sure they would remember to enter the labour for a fictitious royalty employee.  I have enough trouble as it is to get them to enter their time, so I'm not sure that would fly in practice.
 
I might persevere with an outside service on the Routing as that gets the estimators remembering to put that in their BoM, and more accurately reflects margins to sales managers (who are inclined to forget about royalty calculations in their pricing, then jump on the poor accountant saying the costs in the system are rubbish).
 
But I'm still interested to hear if anyone else deals with royalties and does something different from what I currently do.