Terms are used to specify when payment is due on customer invoices and vendor bills. Define the specific requirements of a term of payment by creating a term record. You can create different payment terms for different customers or vendors.
- To create a term record go to billing> Setup> Payment Terms> New
- On the Add to the Accounting List page, select the Term
- On the term page select the standard
- Enter a name for the term in the Terms field
example: “Due on Receipt”, Net 30, Net 60 - In the Days Till Net Due field, enter the number of days until the net amount of the invoice or bill becomes due
Example: For “Due on Receipt” enter the “Day Till Net field” as 0. For “Net 30” enter the “Day Till Net field” as 30 - In the Percentage Discount field, enter the percentage discount if the invoice or bill is paid early.
- In the Days Till Discount Expires field, enter the number of days the early payment discount is available.
For example: if the early payment discount is available for 15 days after the bill is issued, enter 15 in the field then save the record - In the vendor record under the subtab Finance, we can set the terms as specified for a vendor.