Payment process, Dynamics AX Training

Logistics dynamics payment status. Hi again! In this training lesson, we will study the payment process. Payment is a standalone process that does not influence the company profit or loss. This is because the company recognizes the profit or loss when an invoice is posted. After the invoice posting, the posted amount is recorded as the liabilities. The payment process is used to pay the vendor what the company owes. The payment process generates the following transaction: Remember in the first lesson, we have studied that if the Assets increase, the Debit part is used, and if they decrease, the Credit part is used. For the Liabilities is the vice versa. But always Debit is “good” and Credit is “bad” for the company. The Bank account is the Assets account that contains the amount of money that the company has in the bank. The money in the bank decrease, so the Credit part is used. In other words, when the money decrease, it is “bad” for the company. The Accounts payable is the Liabilities account that contains the amounts of money that the company owes to others. The Accounts payable amount decreases, so the Debit part is used. In other words, when debts decrease, it is “good” for the company. The company can pay for the delivered goods or services in different ways: by checks, electronic payments, cash, promissory notes, etc. The payment method and other payment parameters are set up per vendor under Accounts payable > Common Forms > Vendor Details > Payment tab > Terms of payment , Method of payment , Cash discount , Bank account fields. These parameters are used as default ones when the Invoice is created, but can be changed. The list of methods of payments is located under Accounts payable > Setup > Payment > Methods of payment . Methods of payment form. The method of payment is set up for an Invoice, but can be changed when the company pays. In the previous training lesson, the “USAUSD_CHK” payment method was set up for the Invoice. The Invoice also contains information about the terms of payment and the cash discount. The terms of payment is used to define the due date (the last date when the company should pay to the vendor). If the company doesn’t pay to the vendor before or on the due date, the vendor will send the collection letter. We will learn collection letters in the next training lesson when we sell items to the customer, and the customer will not pay. We have used the “N030” terms of payment in invoices. The terms of payment is set up under Accounts payable > Setup > Payment > Terms of payment . The “N030” terms of payment has the following setup – the due date is the current date + 30 days. The Cash discount is used to encourage the company to pay the vendor as quickly as possible. We have used the 1%D15 cash discount in all invoices. The cash discount is set up under Accounts payable > Setup > Payment > Cash discounts . The 1%D15 cash discount has the following setup – the discount for 1% is applied if the company pays to the vendor during 15 days. Payment Steps. The Payment Manager performs the following steps (the payment process): Find what invoices should be paid on basis of due dates or cash discount dates. Create payments in the payment journal. Generate a payment document: a check, a file for electronic payment, a promissory note, etc. Send the payment document to the vendor. Receive an answer from the vendor. Record in the system that the company has to pay to the vendor, i.e. to post the payment. Let’s go through all these steps in Microsoft Dynamics AX. Go to Accounts payable > Journals > Payments > Payment journal . The Journal form opens. Create a new line and select “APPay” in the Name field. Save the line. Click the Lines button. The Journal voucher form opens. Microsoft Dynamics AX allows automatically creating payments on basis of unpaid invoices. Click the Payment proposal > Create payment proposal button in the Journal voucher form. The Vendor payment proposal form opens. Select “Due date & cash discount” in the Proposal type field. Click OK . The Vendor payment proposal form opens. Vendor payment proposal form. The Payment proposal pane contains the payments that are proposed to be paid by the company. The Open transactions pane contains the invoice for which the payment was proposed. If we select another payment in the Payment proposal pane, the information in the Open transactions pane changes. To view all invoices for which payments were proposed clear the Link check box.We can see that there are both invoices that were posted in the previous training lessons and a number of other ones. Select the “222”, “111”, and “485211188” invoices in the Open transactions pane and delete them from the grid (Alt+F9). The Open transactions pane will have only the following invoices: “Invoice 1” (was generated with the help of the Purchase order form) “Invoice journal 1” (was generated with the help of the Invoice journal) “Invoice reg & appr 1” (was generated with the help of the Invoice registration and approval journals). We can see that Microsoft Dynamics AX proposes to pay these invoices later on the last day when the cash discount is valid. Vendor payment proposal form. Let’s assume that the Company decides to pay today for the “Invoice journal 1”invoice. Delete the invoices “Invoice 1” and “Invoice reg & appr 1” from the Open transactions pane. Click the Transfer button. The Transfer payment proposal box appears. Click OK . The Journal voucher form will look as follows: Journal voucher form. We can see that one payment line is created. The “1002” vendor account is debited (for the Liabilities, it means – decreased). The “USA OPER” bank account is credited (for the Assets, it means – decreased). As a result the following transactions will be generated: One vendor transaction for the 1002 vendor One bank transaction for the USA OPER bank account Two general ledger transactions for the controlling accounts.