Disbursement Activities need to be set up for the On Cost transaction. The resulting cost on the Job will be posted to this Activity. This Activity Code will also specify the DR and CR General Ledger code.
It is necessary to have an On Cost Activity for every Activity Group set up. (The Activity Group specifies the Activities that are used for the basis of the On Cost.)
Probably It is a good idea to name the On Cost activity the same as the Activity Group.
Cost Rate
The Cost comes from the On Cost calculation.
Selling Rate
Leave 0. If you enter in a value it will use this to calculate the retail value. This may bear no relevance to the Cost transaction.
Markup Percentage
If you leave it as zero the retail will be calculated from the selling rate above. It is therefore necessary to enter a % to give a valid retail value.