Account Receivable Flashcards
Account Receivable
Payment Schedule methods of allocation
Total - Total amount outstanding on the invoice due.
Fixed amount - A specific, fixed amount is due for each payment on the specified payment dates.
Fixed quantity - Payment of the total amount is divided into a fixed quantity of payments.
Specified - A specified amount is due on each specified payment date.
Payment Schedule
Payment schedule is used to accept customer payment in installments. Define number of installment, amount of each installment, due date of each installment
Terms of payment
Use a term of payment for calculating a due date based on the date of the invoice.
Payment days
Payment day can be specified for either a day in the week or in the month. This helps payment proposal to suggest those customer invoices that should be brought into the customer payment journal for posting.
Cash Discount
- Accrue if a customer meets your company payment terms on time, or are given to customers when they pay their invoices in a specified period.
- Link to the Customer tables and Vendor tables.
- Post to the ledger account that is specified for the cash discount automatically if an invoice is settled on time.
what is underpayment and overpayment in terms of cash discount
over payment means pay more than invoice amount after discount applied. 100 was invoice and discount was 10.5 so customer has to pay 89.50 but customer is paying 89 then 0.50 is underpaid. if customer pays 90 then 0.50 is overpaid
where and what to specify condition to decide what will happen when underpayment and overpayment happens?
Account receivable- setup -account receivable parameters - settlement (dropdown cash discount administration - Specific/ Unspecific). if you select specific then he invoice is settled, and the difference of USD 0.50 is posted to the customer’s cash discount account.
If you select Unspecific, the invoice is settled, and the difference of USD 0.50 is posted to the ledger account that is specified for cash discount differences.
Where and what to specify to calculate cash discount which is based on invoice amount including sales tax / invoice amount without including sales tax
General Ledger - setup -General ledger parameters-Sales tax (in Tax Option fast tab - Customer cash discount section -Cash discount is calculated on amount including sales tax check box)
What is the purpose of Payment fees
If you wants to add more charges added to customer invoice, For example, a customer might be responsible for a fee for issuing a bill of exchange, or a customer might be charged a bank remittance fee.
Step to setup payment fees
Accounts receivable > Payments setup > Payment fee (add an ID, name, description, whether it is charged to a customer or to a ledger account, and the journal type. The journal type is typically the Customer bank remittance journal.) Once you identify the fee, you then select the Payment fee setup to provide more details, You can define a payment fee to set up lines for each fee that is used for different banks, methods of payment, remittance types, payment specifications, currencies, time periods, and amount intervals.
