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8/13/2019 Account Receivable Down Payment Processing and Reconcilliation
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ACCOUNT RECEIVABLE DOWN PAYMENT
PROCESSING AND RECONCILLIATION
PREPARED FOR
Galaxy Backbone Limited
PREPARED BY
Axel Enterprise Systems
Date
01/11/2013
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ContentsPurpose ......................................................................................................................................................... 3
Business Conditions ...................................................................................................................................... 3
Process Overview Table ................................................................................................................................ 4
Process Steps ................................................................................................................................................ 5
Post AR Down Payment Invoice with Incoming Payment.........................................................................5
Procedure..............................................................................................................................................5
AR Down Payment Accounting Entries ................................................................................................. 8
Post AR Invoice..........................................................................................................................................9
Procedure..............................................................................................................................................9Invoice Posting Accounting Entries.....................................................................................................10
Incoming Payment .................................................................................................................................. 11
Procedure............................................................................................................................................11
Incoming Payment Accounting Entries ............................................................................................... 12
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PurposeThe purpose of this document is to give a detailed step-by-step guide for entering and post processing
down payments and subsequent AR invoices without sales orders in the SAP Business One system. It
shows the corresponding ledger entries at each step and clearly shows the reconciliation of down
payments with AR invoices in the customer accounts and other related ledgers.
Business ConditionsThe business process described in this document is part of bigger chain of integrated business processes
or scenarios. As a result, you must have completed any preliminary steps before you start any activities
in this scenario. For simplicity and clarity, taxes, discounts and approval steps have been omitted from
this scenario
Business Scenario
A sale has been made to a customer. The customer is required to make a down payment on the order.
The down payment is applied to the final invoice and the customer pays only the net due amount (fullinvoice amount less down payment) on the invoice due date. The scenario modeled in the document are
as follows
The customer places an order worth 10,000 naira. He makes a down payment of 4,000 naira.
The Down Payment invoice is generated and the incoming payment is posted in one step
Upon fulfillment of the order, an invoice is sent to the customer with a net due amount of 6,000
naira (10,000 naira less Total Down Payment of 4,000 naira)
The customer pays the balance due of 6,000. An incoming payment is posted and his account is
cleared
Accounts Overview
Account Number Description
102010100 Trade Debtors
202040000 Payments Received in Advance
401010000 Revenue- Internet connectivity
102030100 Petty Cash
CL10006 ASO (sample customer)
Notes.
Trade debtors account is the control account for the Customer Sub-ledger
These accounts are stated AS-IS in the system configuration and accounts determination as at
the day of document release
The customer account used has been chosen to represent a typical transaction. No settings have
been made in the customer data to override system default account determinations.
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Process Overview Table
Process Step Business Condition Expected Results
Enter AR Down Payment Invoice
with incoming payment
Customer pays the required
down payment, the employee
creates the down payment
invoice.
AR down payment invoice is
created
Post incoming Payment The customer pays the down
payment and the incoming
payment is posted in SAP
The incoming payment from the
down payment is posted.
Post AR Invoice The order is fulfilled and the
customer is sent an invoice with
the down payment applied
An AR invoice is generated with
due amount of Full invoice
amount less down payment
Post incoming invoice The customer pays the amount
due from the AR invoice
Incoming payment received and
customer account cleared
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Process Steps
Post AR Down Payment Invoice
In this activity, the AR down payment invoice is posted. The incoming payment is posted in the same
step.
Procedure
1. Access the transaction using he following navigation path
Main Menu Modules Sales A/R A/R Down Payment Invoice
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2. Enter Customer details, item details and price. Enter the Down payment percent as shown
3. Click to post the down payment invoice. The Accounting entries are shown below.
Trade Debtors Payment Received in Adv.
D C D C
1a 4,000 4,000 1a
Customer
D C
1a 4,000
1a Down Payment Invoice
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Post Incoming Payment
Procedure
1. Access the transaction using the following navigation path
Main Menu Banking Incoming Payment Incoming Payments2. Enter the customer details and select the down payment invoice
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3. Click on the payment means button to choose payment method and enter payment
amount
4. Click to confirm the amount
5. Click to post the incoming payment
AR Down Payment Accounting Entries
Trade Debtors Payment Received in Adv.
D C D C
1a 4,000 4000 1b 4,000 1a
Customer Cash
D C D C
1a 4,000 4,000 1b 1b 4,000
1a Down Payment Invoice
1b Incoming Payment(Down Payment)
*items in GREEN are cleared
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Post AR Invoice
In this activity, the invoice is posted in FULL and the down payment is applied to this amount to
generate the net due amount.
Procedure
1. Navigate to the A/R invoice transaction using the following navigation pathMain Menu Modules Sales- A/RA/R Invoice
2. Enter the Customer Details, Item Details and Price.
3. Select the browse button to select appropriate down payment related to the invoice. The
system automatically calculates the balance due (Full invoice amount less Total down payment)
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4. Click to post the invoice. The accounting entries for this transaction are shown below.
Invoice Posting Accounting Entries
Trade Debtors Payment Received in Adv.
D C D C
1a 4,000 4,000 1b 4,000 1a
2 6,000 2 4,000
Customer Cash
D C D C
1a 4,000 4,000 1b 1b 4,000
2 6,000
Revenue
D C
10,000 2
1a Down Payment Invoice
1b Incoming Payment(Down Payment)
2 AR Invoice (Full amount with Down payment applied)
*items in GREEN are cleared
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Incoming Payment
In this activity, an incoming payment for the balance due is posted. This posting clears the customer
account and recognizes the inflow into the bank/cash account
Procedure
1. Navigate to the Incoming payments transaction using the following pathMain Menu Modules Banking Incoming Payments Incoming Payments
2. Enter the Customer code and select the appropriate invoice
3. Click on the payment means button , choose the means of payment and enter the payment
amount, click
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4. Click to post the transaction. The accounting entries are shown below. Note that this
posting clears the balance due amount in the customer account. The Accounting entries are
shown below
Incoming Payment Accounting Entries
Trade Debtors Payment Received in Adv.
D C D C
1a 4,000 4,000 1b 4,000 1a
2 6,000 6,000 3 2 4,000
Customer Cash
D C D C
1a 4,000 4,000 1b 1b 4,000
2 6,000 6,000 3 3 6,000
Revenue
D C
10,000 2
1a Down Payment Invoice
1b Incoming Payment(Down Payment)
2 AR Invoice (Full amount with Down payment applied)
3 Incoming Payment (Total Invoice less Down Payment)
*items in GREEN are cleared