Recently I explored the vendor prepayment function in MS Dynamics 2012 on my previous blog posts which covered overview of the function, posting profile setups, vendor prepayment assignment, and settlement.
At this post I will look at the final step of vendor prepayment which completing the business cycle by applying the prepayment invoices to balance vendor account.
The warehouse keeper receives the goods from the vendor, and performs the product receipt (physical update).
The vendor issuing the Purchase Order invoice and the accounts payable accountant register the Purchase Order invoice in MS Dynamics AX 2012, enter the invoice number, and invoice description.
The accounts payable accountant should apply the prepayment on the vendor invoice, here I will assume the AP accountant will apply prepayment invoice on the Purchase Order invoice. by click on Apply prepayment
After applying the prepayment MS Dynamics AX 2012 creates a line with prepayment amuont
If the AP accountant does not apply the vendor prepayment invoice MS Dynamics AX 2012 will pop up an info log
Here MS Dynamics AX 2012 gives an option to apply the vendor prepayment invoice on vendor account after posting PO invoice
Go to vendor code on All vendor list, select vendor, select Invoice tab, and click on Apply.
The generated entry is based on posting profiles setup on MS Dynamics AX 2012 demo company:-
Entry to cancel physical receiption update, and generates financial update
Dr.Accounts Payable – Uninvoiced 1000
Cr.Accounts Payable – Raw Materials-1000
Dr.Finished Goods Inventory 1000
Cr.Finished Goods Inventory -1000
Entry to apply prepayment to pyable account
Dr.Accounts Payable – Raw Material 100
Cr.Prepaid expense -100
User group: DynamicsArabia