You can use credit limits to manage the amount you spend using credit with vendors.
A credit limit sets a maximum currency amount that should be spent using credit without making a payment.
To use vendor credit limits, you first need to set credit limits on vendor records, and then enable the Vendor Credit Limit Warnings preference.
Set a credit limit on a vendor record to define the maximum currency amount you want to accrue in outstanding payables.
To set credit limits for vendors:
- Go to Lists > Relationships > Vendors.
- Click Edit next to the vendor name.
- On the vendor record, click the Financial subtab.
- Under Account Information, in the Credit Limit field, enter the maximum currency amount to spend on credit with this vendor.
- Click Save.
- Next, enable the preference to receive a warning after a vendor credit limit has been reached.