Daily Archives: March 16, 2013

Tip #120 – How to Issue Credits if You Are Using “Open Balance” Statements


Tip #120
How to issue a credit to an account
if you are sending open-balance statements

If you are sending open-balance statements instead of balance-forward statements, issuing a credit to an account should be done differently than by adding a credit through the Accounts Receivable module.

Why, you ask?  Because open-balance statements only show orders with outstanding balances and a credit to a house account entered through the Accounts Receivable module does not create an order with a negative balance.  If it did, it would throw the account out of balance.

So what should you do if you use open-balance statements?  The same thing I just explained why a credit on account cannot do.  You should simply create an order for the customer with a negative balance.

Here is how…

  1. Go into the New Orders menu and begin entering a local order as you would normally do for the customer you want to give credit to.
  2. When you get to the recipient’s area, enter “XX” in the recipient’s name field so that flowerSoft will not calculate a delivery charge.
  3. You can leave the enclosure card blank or you can type something like “CREDIT TO ACCOUNT”
  4. When you get to the “Items Sold” screen, enter a quantity of “1” and in the item code field, enter “CRED.”
  5. In the description field the word “CREDIT” will automatically appear.  Add any additional wording to it, like “CREDIT FOR RETURNED VASES” or anything else you want to say.
  6. Enter the amount of the credit in the Unit Price field.  You should precede the number with a minus (-) sign but if you don’t, flowerSoft will do it for you.
  7. Enter the total amount of the credit, flowerSoft will pull out the sales tax amount later.  However, if you make the order tax exempt after flowerSoft has removed the sales tax from the total credit, you will have to adjust the credit back to its original amount.  flowerSoft will only do this once, so make sure that the amounts you enter are correct.
  8. Select the method of payment.

Here is the graphical version…

credit01credit02credit03credit04credit05

Tip #119 – How to Credit a Finance or Re-Billing Charge


Tip #119
How to credit a finance or re-billing charge

As all of you are aware, finance and re-billing charges are just a tool to get the customers to pay.
Most of the time, they will send the payment without including the amount of the additional late charge.
Most of you will accept this as full payment and waive the finance charge.

There are several ways of getting rid of a finance or re-billing charge, but the only way I recommend is by including a finance/re-billing charge allowance when entering the payment from the customer.
This works well whether you are sending balance forward or open balance statements.

Here is the proper way to waive a finance/re-billing charge.

fca01

By the way, this is also the correct way to apply a sales allowance as doing it from here will reduce your sales tax liability.