Title/task or Concept: AP Contras against Deeley/ESP AR balances

Transcription

1 Title/task or Concept: AP Contras against Deeley/ESP AR balances Module: Accounting Audience: In order to perform this task the student should be knowledgeable about the concept of contra Vendor payments and how the dealership will either pay or invoice for the difference between the A/R balance and the AP balance for that Vendor. Introduction/background/scenario: A dealership can have many relationships with one particular Vendor. With Deeley Harley Davidson for example, a dealership can owe them for parts purchased for stock and also for units which are on a floor plan notes payable invoice. Deeley HD can also owe the dealership for ESP (extended Service Plan) Claims generated by the dealership for work done on Deeley HD units or for financing on a deal supplied by Deeley HD. This Vendor can thereby be both an AR and an AP Vendor. Instead of the Vendor paying the dealership for their outstanding balance, and the dealership paying the Vendor for their outstanding balance, both balances are applied against each other and the dealership will either pay or invoice the Vendor for the difference. This is what is considered a contra payment. What s in it for me? Keeping the Contra Vendor Accounts clean is necessary to having a clear view of the current status of the outstanding balances. With the large quantity of transactions that happen between the Vendor and the Dealership, the list of outstanding invoices can get extremely long and hard to maintain. If the contra payments are done frequently, then it is that much easier to keep the accounts in order. Goals/objective: To learn how to make contra payments by applying A/R balances against AP balances for a specific Vendor. Here s how: 1. Select AR Invoices for Contra Payment 2. Select AP Vendor to apply AR invoices against 3. Reviewing AP Vendor Invoices 4. Settling the AP Vendor Account Dealer Vu lesson AP Contras against Deeley/ESP AR Balances Page 1 of 5

2 Step 1 - Select AR Invoices for Contra Payment Go to Business Office-> Accounting-> AR Transactions->Click on the New AR Contra Payment Icon. The Select Customer window will pop up, enter the name of the AR Vendor and click Find. Double click on the Vendor and the AR Contra Payment Screen will open with the list of the AR invoices and the AR Vendor s details at the top left corner. Select the AR invoices you wish to apply or enter the amount paid for those who will be partially applied (these will show in yellow once the amount has been entered). Step 2 - Select AP Vendor to apply AR invoices against From the AR Contra Payment screen; click on the ellipse box to the right of the Payable pane. This will bring up the Select Vendor Screen where you can enter the AP Vendor and click Refresh. Double click on the AP Vendor to bring them onto the AR Contra Payment Screen. The AP Vendor s details will fill the Payable pane. Dealer Vu lesson AP Contras against Deeley/ESP AR Balances Page 2 of 5

3 Enter in the Invoice # or leave it blank (the system will generate one for you), select your posting date and click on Save and Post (or Save/Post and New Payment if you have another contra payment to make). Step 3 Reviewing the AP Vendor Invoice The system has now generated an AP invoice with a negative balance (total of the AR invoices) for the AP Vendor selected. To verify this invoice, click on the ellipse button next to the Invoices # field. This will open the Vendor Invoice; click on the Receivable Contra Tab. In this Tab you will find the posted AR Contra payments. (You can view the payment details by right clicking on the payment and selecting Show Details ) Dealer Vu lesson AP Contras against Deeley/ESP AR Balances Page 3 of 5

4 Step 4 - Settling the AP Vendor Account In order to keep the AP Vendor Account as clean as possible, the AP Vendor Invoice can now be applied against the other outstanding AP invoices. Go to Business Office- >Accounting-> AP Transactions. Click on the new payment icon. From the Payable Payment Detail Screen, click on the Add Item icon; the select invoice screen will pop up. Select the AP Contra Vendor from the Vendor drop down list and click Refresh. Select the AP Vendor invoice created in Step 2 along with the AP invoices you wish to apply it against and click OK. If your payment total is not 0, enter the balancing amount in the amount paid field of the AP invoice of your choice. Click on the Adjustment box, and select the suspense account from the drop down menu. (This is simply to avoid having to specify the payment method of overwritten the check number.) Dealer Vu lesson AP Contras against Deeley/ESP AR Balances Page 4 of 5

5 Click on the Post icon. Now these outstanding AP Invoices have been cleared out the AP Contra Vendor Account. Connections to Other Areas/Modules: Related reports AP and AR Aging Summary or Detail Report Related reports AP and AR GL Subledger Report AP and AR Transaction Screens What can go wrong & what can you do about it? Can t find a parts Vendor Invoice The parts Vendor Invoice is not in Posted status. Locate the invoice through the AP Transactions screen (Unposted transactions) open it, select Posted and then click Save. Now the invoice will be available when doing the application of AP Contra Invoice against the other AP invoices. Dealer Vu lesson AP Contras against Deeley/ESP AR Balances Page 5 of 5