AR Terms Codes window

AccountsReceivableCS > Accounts Receivable > Options menu > AR Terms Codes window

Terms Codes let you to set up payment discounts and finance charges that can be automatically applied.You’ll need at least one Terms Code to set up your AR Codes.

Set up a Terms Code for each different early payment discount or finance charge policy you have. Other discounts, such as volume discounts or preferred customer discounts, are set up in the Accounts Receivable, Inventory, and Sales modules.

Terms Code

Enter a code of up to six characters in this box.

Description

Assign a description of up to 50 characters that identifies the early payment discount and/or finance charges represented by this Terms Code. For instance, 2/10, Net 30 typically identifies a policy of a 2% discount given to customers who pay in full within 10 days, with the full amount being due (without any discount) within 30 days.

Finance Charge Rate

If the Code includes a finance charge, enter the monthly percentage to charge.

Days Before Fin. Chrg.

If this Code includes a finance charge, enter the number of days from the transaction date that finance charges begin.

Discount GL Account / GL Key

If you are not using the interface table, this box is labeled GL Account and you should enter the General Ledger account to post these discounts to.

If you use the interface table, this box is labeled GL Key. In this case, enter the GL Key to represent this Terms Code. Use the same GL Key for all Terms Codes that post to the same General Ledger account.

If Accounts Receivable is not integrated to General Ledger, you can leave this box blank.

GL Description

This will auto-fill with the description of the General Ledger account you entered in the GL Account box. This information comes from the account information you set up in General Ledger, and cannot be changed here.This box will only appear if you don’t use interface keys.

Discount Table

If this Terms Code is only for finance charges, you don’t need to enter information in these fields. Otherwise, you need to complete at least one row of discount information.

Use multiple rows to establish an incremented discount policy that extends a diminishing discount rate as days elapse. You can enter up to five rates.

Rate

The discount amount in the Rate field is the discount percentage, which can be any number between .01 and 99.99. Fifty percent is typed 50, one-half percent is typed .50.

Days / Type

The discount Days field, in conjunction with the discount Type field, specifies when the payment must be received by for the customer to receive a discount.

The Days field specifies the number of days to count, or the day of the month. The Type field specifies when to start counting. There are three choices for the Type field. Use the drop-down to select one of the following types for each rate:

• Days from Transaction Date: This type counts days elapsed since the transaction date on the invoice.

• Days from End of Month: This type counts days back from the end of the month.

• Day of the Month: This type extends the discount through the day of the month specified in the Days field.