Customer Payment Terms / Discount Not Taken

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Hello. We have a customer with discount payment terms applied to their account.

They paid outside of their "15 days" discount window, and paid the full amount of the invoice instead of taking the discount.

How do we add these additional funds to their account? Is there anything else that would need to be done to tag it to the G/L? The bank deposit already shows the full amount paid.

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MG-16101311-0 26,225 on at

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I am confused. If the customer paid outside of the 15-day discount window, then GP shouldn't have calculated a Discounts Taken amount. Are you sure you are not confused between Discounts Available and Discounts Taken? For example, if an invoice was entered for $100 and you are offering a 2% discount if paid within 15 days, GP would have calculated the following distribution for the invoice:

Sales ($100)

Discounts Available $2

Receivables $98

If you receive the payment outside of the 15 days period, then the following would be the distribution for the cash receipt:

Cash $100

Discounts Available ($2)

Receivables ($98)

On the other hand, if the payment would have been made within the discount period, presumably they would have sent in a payment for $98, hence the distributions would have looked something like this:

Cash $98

Discounts Taken $2

Discounts Available ($2)

Receivables ($98)

If I am misinterpreting something, please feel free to clarify following the above example.

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Hi Mariano, thanks for your reply! Pardon my naivety as I'm not the accountant for our office, but we have someone new in that role who's not familiar with GP.

My verbiage may be a bit off :) Anyway, the customer's payment terms weren't set up with the discount, but they had an automatic 2% discount on the trade discount. So, using your example, their invoice subtotal showed $100, and the trade discount $2.00, with the final total being due $98.

They paid outside of their payment terms and paid the full $100, instead of $98.

Perhaps I could have done something at the Cash Receipts step, but I didn't.

Now, the bank deposit shows $100 paid, but their GP customer account has an outstanding credit balance of $2, since the $100 payment was applied to an invoice of $98.

How do I get that $2 back into their account as being applied to that invoice?

- Should we go to the Receivables Transaction Entry screen?

I look forward to your reply.

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L Vail 65,271 on at

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If your Customer's AR balance is showing a credit amount, you can use a write-off transaction to write off the lone credit. Look at the original entry and make the necessary adjustments via the distribution accounts.

If your original transaction was:

dr Accounts Receivable $98

dr Trade Discounts $2

cr Sales $100

If your customer is showing a credit balance of $2, you can use the write-off transaction entry window to write off the credit. The distributions on the write off should be:

dr Accounts Receivable $2

cr Trade Discounts $2

Kind regards,

Leslie

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Hi Leslie, thanks for the reply. The customer "overpaid" by $6.00 because they didn't take the discount. So, I need to "charge" them for $6.00 to match their payment/GP deposit. Should we do a "Receivables Transaction Entry" and do a Sales/Invoice entry?

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L Vail 65,271 on at

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Hi Annie,

You need to do a Receivables Transaction Entry and create a Sales/Invoice entry for $6. After you post that entry, go into the Apply Sales Documents, select the payment document and apply that document to the $6 invoice you just created.

Kind regards,

Leslie

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Community Member on at

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Perfect. That's what I thought and wanted to be sure. Thank you so much! Have a great day!!

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