The cash discount agreements for a vendor can be stored in the vendor master record. They can then be copied from the purchase order, where they can be changed.
When you enter an invoice, the agreements (from the purchase order, if available, otherwise from the vendor master record) are displayed as default values on the vendor screen in the section Payment control. These values can be overwritten.
The following fields also have to be filled out: · Baseline date
This field specifies the starting date from which the days for the terms of payment are valid. The date proposed by the system can be changed, if required.
· Discount base
If the amount qualifying for cash discount is different from the invoiced amount, you must enter the correct amount here.
· Discount amount
In this field you can enter a fixed amount which the vendor in the invoice grants as a cash discount. If you fill out this field, the system will ignore the displayed terms of payment. · Terms of payment
In this field, the system displays a key for the terms of payment, if any are stored in the system. These agreements come from the purchase order or from the vendor master record. To the right of the screen, the system displays the actual terms, that is, the period in which cash discount is to be granted, the percentage discount, and the date on which the invoice is payable net. Both the key for the terms of payment and the values
belonging to the key can be overwritten.
12.3.1. Types of Cash Discounts
There are two ways of posting the cash discount amounts: · Posting the gross amount
If you post the gross amount of an invoice, the system will ignore the cash discount amount when you enter the invoice data. The cash discount amount is posted to a separate income account when payment is later made.
· Posting the net amount
If you post the net amount of an invoice, the cash discount amount is credited directly to the account to which the costs are posted. For example, if you are posting an amount to a cost center, only the invoice amount minus the cash discount amount is posted to the cost center.
You specify the way in which cash discount is to be cleared on the initial screen in Invoice Verification in the field Document type. In the standard system, there are two document types:
RE - Gross posting RN - Net posting 12.4. Tax Data
As a rule, incoming invoices include sales tax. This is specified either as a percentage rate or as a set amount. This must be entered together with the general invoice data. The relevant postings are made automatically by the system.
You enter the tax information contained in the invoice in the following fields: · Tax amount
In this field you enter the amount of the tax contained in the invoice. · Tax code
The tax code is a key that specifies the tax type and the tax percentage. The system allows only the tax codes defined by your system administrator.
· Calculate tax
If the tax amount is not specified explicitly in the invoice, the system can calculate the tax amount itself.
Your system administrator can determine how many tax amounts and codes can be entered in the vendor screen by making the appropriate settings in the Customizing system of Invoice Verification.
The tax code entered for an item can be changed on the item screen (unless the tax code is contained in the G/L account).
The system uses the tax code and the amounts on the individual items to determine the tax base for each tax code. When you choose Simulate or Post, the system checks
whether the tax amounts are correct and ask you to make any necessary corrections.
Posting Taxes
Which taxes are to be paid and how they are to be posted in the system depends on the tax regulations defined by law in the country of the company concerned. The postings made are controlled by the tax code. A distinction is made between the following:
Deductible taxes
Non-deductible taxes
Deductible taxes
Input tax is paid to the vendor, who passes this on to the tax authorities. The offsetting entry for the tax payment is posted to a separate input tax account. On the basis of this account and the sales tax account, Financial Accounting can calculate the difference between the tax received and tax paid and pay the amount to the appropriate tax authority. The system creates a line for every tax code you enter. If various line items have the same tax code, the tax postings are summed up.
Non-deductible taxes
There are three different ways of processing non-deductible taxes: · Distribution among invoice items
With this processing method, you post the invoice and tax amounts to the vendor account. The taxes are distributed among the G/L account line items and totaled in each case as a net value. Example: Distribution among Invoice Items
· Separate posting lines
With this processing method, you post the invoice amount and the tax amount to the vendor account. The offsetting entry is split: the offsetting entry for the invoice amount is posted to the stock account, and the offsetting entry for the tax amount is posted to separate tax accounts. Example: Separate Posting Lines
· Sales tax not charged
In this case, the invoice does not contain any taxes. The tax is determined by the tax code entered. You do not enter a tax amount. The tax expense is either distributed among the invoice items or posted separately. The offsetting entry is posted to separate tax accounts. Example: Sales Tax Not Charged
In all three cases, the tax can be defined on multiple levels. The postings to the individual levels can be distributed to different accounts.
The procedure, tax records, and the accounts to be posted are controlled via the tax code; you can maintain the settings in the Customizing system of Financial Accounting.