Calculating Discounts

If your vendors offer discounts for early invoice payment, you should define a terms code for each of the methods used to calculate discount amounts and discount periods.

Accounts Payable uses the terms code you specify with an invoice to calculate the discount period and amount for the document. If the terms code defines a multiple payment schedule, Accounts Payable sets up a payment schedule tab that includes separate discount information for each payment.

You can also specify whether the invoice discount applies to a particular detail, or not. To indicate that a detail is not subject to the invoice discount, you simply clear the Discountable option for the detail on the Detail Items/Taxes form, or select No for the option on the detail-entry grid.

You can change the discount date, discount base, amount, and discount rate at any time until you post the invoice.  Note that you must enter a discount date before you can enter an amount or a rate.

The discount date determines whether a discount is available when you enter a payment in the Payment Entry form. If a discount is available, Accounts Payable displays the available discount amount and the invoice total net of the discount when you apply payments to the invoice.

Discounts do not apply to credit notes and debit notes.