Client is Representative of leading Manufacturer of (XYZ products). They are on solely on ‘commission’ business. They do not manufacture anything or do retail sales.
When Sales Order comes from customer it diverted to manufacturer and client get their commission.
e.g. : Sales Invoie No: 12345- $10,000 assume that they get 10% of Invoice is $1,000 commission (i.e. Client Sales) Actual Client Sales is 1,000 not 10,000$
Manufacturer – as Receivable outstanding Balance is $1,000.
So when Manufacturer send check of $1100.00 – Wait a minute how come it is $1,100. Receivable was only $1000 but sometime existing customer directly buy from Manufacturer without letting client know and client gets their commission i.e. extra $100.- called Over Payment
When we receive $1100 in check how can I handle extra $100?
I was thinking to create Custom Cash Receipts screen using eConnect or WebServices , which create Invoice for $100 first user will post invoice and then apply cash Receipt . Simple Scenario.
Same Manufacturer on next Check assume that $2000 was balance on Inv2222 but they send check $1,000 and said that they deduct 150$ from Invoice 12345 as customer Returns product (We lose commission). This client called New Order (negative)- How to handle this negative? So now actual outstanding is $850.
Sometime Manufacturer will send check without client generating invoice to them let say 500$ - called again New Orders.- Creating Invoice n will apply to incoming Next Payment.
Now let’s go to following scenario:
Client Paid $ 5500 in check but says that they adjusting commission from Invoice 4444 for $100
|
Invoice#
|
Original Amt
|
Outstanding Amt
|
Apply Pmt
|
Commision Adjustment
|
Over Payment
|
Outstanding
|
|
4444
|
1200
|
1200
|
1000
|
100
|
|
100
|
|
5555
|
2000
|
1200
|
1500
|
|
300
|
0
|
|
6666
|
3000
|
3000
|
3000
|
|
|
0
|
How to handle $ 100 adjustments. I have to reduce ‘Sales’ by $100. If we do writeoff $100 it work perfect but client want to put write off in Cash Receipts because they think it’s commission adjustment and next time client come back and pay $100 as wrongly adjusted.
For 300$ overpayment will create Invoice first-post and apply to payment.
If I don’t do write off and create sales return for $100 to reduce revenue (Sales) then my Cash Receipt is still show open with unapply $100.
Below is my live/production – check details
Check Amount: $11782.26
Actual Apply Amount: $7988.16 (Actually applied to invoice)
Over Payments : $623.1 (Over Payment against Invoices, will create Extra Invoice)
Commission Adjustment : $48.00 (Thinking to write off)
New Orders : $3123.36 (Payment without Invoices)
What will be GL effect ?
What is best way to handle this kind of situation?
Thanks
