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Dynamics 365 Community / Forums / Microsoft Dynamics GP (Archived) / TREATMENT OF RETURN OF...
Microsoft Dynamics GP (Archived)

TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

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Posted on by zulfi721

i have received an advance payment of USD 1000/- from a customer.

 upon receiving i entered the cash receipt voucher

distribution would be like this

DEBIT:BANK A/C

CREDIT:ACCOUNT RECEIVABLE

and along with this customer's subsidiary account is credited with an advance payment of USD 1,000/-

Now at a later date customer cancelled the order and i have to return the received advance.

How can i  enter this return of advance to customer in dynamics GP-2013

NOTE: i don't have any sale invoice for this customer neither any prospect of future sale to adjust this advance received

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  • soma Profile Picture
    soma 24,410 on at
    RE: TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

    Have you deposited the payment (USD 1000) which you have received from customer to your bank?

  • Suggested answer
    soma Profile Picture
    soma 24,410 on at
    RE: TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

    1. If the payment is not deposited in your bank, then void the cash receipt in GP.

    2. Otherwise create a debit memo in Receivable transaction entry window(Transactions-->Sales-->Transaction Entry) with $1000 and apply the debit memo to the cash receipt which you have already posted in Apply Sale Document window (Transactions-->Sales-->Apply Sales Documents).

    Hope this helps!!!

  • zulfi721 Profile Picture
    zulfi721 on at
    RE: TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

    yes  i received this payment in bank

  • zulfi721 Profile Picture
    zulfi721 on at
    RE: TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

    Debit note.....Will debit the customer account....

    In case of sales we debit to customer..................

    Distributin will be like this....

    Debit::A/c receivable  *********

    Credit:                sales A/c   *********

    and in the sub ledger customer is debited.

    here in this case how we can debit to customer i am unable to understand the logic by passing a debit note....although he does not have any sales...rather i am returning his advance payment.

    Also nothing is being charged/imposed to customer......why we will debit him...

    and when i will try to calculate my net sales it will show a wrong picture.

    Gross sales              

    Less:sales returns

    Less credit note

    Add:debit Note

    Net sales:

  • zulfi721 Profile Picture
    zulfi721 on at
    RE: TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

    As per my understanding i can use debit note for debiting any additional charges to customer....which somehow i couldn't bill in the invoice

  • Suggested answer
    soma Profile Picture
    soma 24,410 on at
    RE: TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

    Here is the default distribution for debit notes.

    Distributin will be like this....

    Debit::A/c receivable  

    Credit: Misc income A/c or Offeset/Contorl Account   (not sales accounts.)

    Debit note transaction you need to use one misc income account like an offset/control account. It will help us to identify how much we have returned or earned from customers.

    Hope this helps!!!

  • zulfi721 Profile Picture
    zulfi721 on at
    RE: TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

    Thx for the default distribution of debit note.....

    But it is not  income.........i am just returning the advance payment..

    The above distribution was referred for sales default distribution not for debit notes distribution.

    Also as this payment has been returned through bank

    how i will tackle this situation in dynamics....

  • Suggested answer
    soma Profile Picture
    soma 24,410 on at
    RE: TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

    Zulfi,

    This is default distribution for debit notes in GP. Normally we are suggest to use Misc income A/c for debit notes. If this is a return then you can use any other offset accounts.

    Normally we are suggesting the below process for clients for returning the customer payments.

    After made this debit notes, you need to create one more transactions in bank transactions for crediting your bank and debit this offset accounts.

    Hope this helps!!!

  • Suggested answer
    soma Profile Picture
    soma 24,410 on at
    RE: TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

    Otherwise, create a Receivable Transactions with type of Finance Charges (Debit AR and Credit offset account) and apply to cash receipt then create a bank transaction to debit the offset account used for finance charges and credit the bank accounts.

    Hope this helps!!!

  • zulfi721 Profile Picture
    zulfi721 on at
    RE: TREATMENT OF RETURN OF ADVANCE PAYMENT FROM A CUSTOMER

    What about this treatment.

    Transaction>Financial>Bank Transaction

    IST WE ENTER RECEIPT OF ADVANCE PAYMENT

    Debit:Bank Account  ******

    Credit:Miscellaneous Income ******

    (upon receipt of advance)

    -----------------------------------------------------------------

    2nd

    Debit:Miscellaneous Income ******

    Credit: Bank Account                          ******

    (upon return of advance payment)

    --------------------------------------------------------------------

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