Accounts Receivable Terms and Percentages

phpBMS can configure Accounts Receivable to use specific term time frames and service charge percentages.

Accessing Accounts Receivable Configuration Settings

1. Log in as a user with administrative rights.
2. Choose 'Configuration' from the 'Settings' menu.
3. Scroll Down to the section titled 'Accounts Receivable'.

Settings

This area defines the three periods used for aging as well as the percentages used for service charges if items are past the defined terms when aging is run on them. The three terms are defined in days and by default are set to 30-60-90 day separation.

With the defaults, invoices are due within 30 days after the invoice date to avoid late charges.

If aging is run after an invoice is past its first term, an additional 'service charge' AR item is created for the client. The service charge amount = (the amount due on the invoice) x (the first term percentage).

Each term is set in days, and each percentage should be entered as a decimal number between 0 - 100.0. The Term 1 days should be less than the term 2 days, which in turn should be less than the term 3 days.

Other common example of aging term day amount sets would include

• 15-30-45
• 15-45-90
• 30-60-120

Percentages may vary, as some companies charge a consistent percentage, regardless of which term limit the invoice is over.

For more information on charging a Sales Order to Accounts Receivable, see ChargingToAr.

For more information on running Aging see ArAging?.

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