AP Invoice Types and Accounting Entries

Invoice Types in AP
1.Standard Invoice
2.Debit Memo
3.Credit Memo
4.Interest Invoice
5.Withholding Tax invoice
6.Prepayment invoice
7.Mixed Invoice
8.Retain age release invoice
9.Expense report
10.Payment request Invoice

1.Standard Invoice
Item expense account --DR  TO Liability account CR

2. Debit Memo
Debit Memo is used to decrease the supplier balance for any price corrections or discounts or wrong billing.
It is raised by the organization and send it to the supplier.
Liability account -- DR TO Item expense -- CR

3.Credit memo
Credit memo is used to decrease the supplier balance for any price corrections or discounts or wrong billing.It is raised by the supplier and send it to the organization .
Liability account -- DR  TO Item expense -- CR

4.Prepayment Setups
Setup---options---payable options---accounting options
Prepayment account -----from Supplier site
Invoice Tab----Payment terms: Immediate
Settlement days: 2
Prepayment  types:
Temporary Prepayment
Permanent Prepayment
Temporary prepayment can be converted as permanent prepayment if the Temporary prepayment is not applied to any transaction.
Permanent prepayment is a caution deposit.
Navigation: Invoice---Entry---Invoices
Prepayment type: Temporary prepayment
OU name,paygroup,supplier number
Accounting entries:
When the prepayment is created:
Prepaid exp -- DR TO Liability account -- CR
When the prepayment is paid:
Liability account -- DR  TO Cash A/C -- CR
When the prepayment is matched with the invoice
Liablity A/C -- DR   TO Prepaid A/C --CR
Refund entry
Cash A/C -- DR  TO Liability A/C --CR

5. Withholding tax:
1.Define withholding tax code
Navigation:
Setup---tax---codes
2.Define withholding tax group
Setup---tax---groups
Tax options at payable options
Setup---options—payable options
Go to withholding tax tab:
Check the below check boxes
Use Withholding tax
Allow manual withholding
Include withholding amount basis
Include discount amount
Create withholding tax at payment time or invoice validation time select this option based on the
Client requirement. Based on the option selection system will generate the withholding tax invoice
Define withholding tax calendar
Setup---calendar---special calendar
Type of calendar: Withholding tax


Define tax authority as a supplier
Enter all the required information and go to organization tab select type as Tax authority
Associate tax group at supplier level and supplier site level.
Mixed Invoice:
It is a supplement of standard, debit, credit memo
If you create mixed invoice with negative amount then it is debit or credit memo
If you create mixed invoice with positive amount then it is standard invoice
Expense Reports:
These reports are submitted by the employees on the reimbursement of their expenses like
Travel,medical,projects etc
Setups:
Define employee in HRMS
Click on Assignments---Enter Expense account save
Switch to AP
Setup---invoices—expense reports templates
Define expense report
Setup—options---payable options
we have to check Automatically create employee as supplier check box
run expense report export program
then query the invoice and validate and create accounting