Terms Code FAQs

Yes. You can use Terms Code Maintenance to establish common payment terms for your customers. After terms codes are established, you can assign these standard terms to customers. For more information, see Terms Code Maintenance.

The following are terms code examples.

Example 1

This example is based on the following field entries made in Terms Code Maintenance.

Field	Entry
Terms Code	02
Description	2% 10 Days, Net 30 Days
Days Before Due	30
Days Discount Allowed	10
Discount Method	Discount on Gross Amount
Discount Rate	2.000%

In this example, the discount due date is calculated to be within 10 days after the invoice date, and the invoice due date is determined to be 30 days after the invoice date. The discount applies to the gross invoice amount.

Example 2

This example is based on the following field entries made in Terms Code Maintenance.

Field	Entry
Terms Code	04
Description	2% 10th, Net 30
Days Before Due	30
Days Discount Allowed	10
Day of a Month	check box selected
Minimum Days Allowed	5
Discount Method	Discount on Line Items Only
Discount Rate	2.000%

If the invoice is dated after the fifth of the month, the discount due date would be the tenth of the following month. If the invoice is dated before the fifth of the month, the discount due date would be the tenth of that month. The invoice due date is calculated as 30 days after the invoice date. The discount applies to the invoice line items only.

Example 3

This example is based on the following field entries made in Terms Code Maintenance.

Field	Entry
Terms Code	05
Description	4% 10th, Net End of Month
Days Before Due	31
Day of a Month	check box selected
Minimum Days Allowed	0
Days Discount Allowed	10
Discount Method	Discount on Line Items and Freight
Discount Rate	4.000%

In this case, 10 days are added to the invoice date to determine the discount due date, and the invoice due date is calculated as the end of the month beyond the discount due date. This discount applies to invoice line items and freight. An invoice dated January 27 would have a discount due date of February 6, and the invoice due date would be February 28 or 29 (not January 31).

Yes. You can use A/P Terms Code Maintenance to establish common payment terms for your vendors. After terms codes are established, you can assign these standard terms to vendors. For more information, see A/P Terms Code Maintenance.

The following are terms code examples.

Example 1

This example is based on the following field entries made in A/P Terms Code Maintenance.

Field	Entry
Terms Code	02
Description	2% 10 Days, Net 30 Days
Days Before Due	30
Days Discount Allowed	10
Discount Rate	2.000%

In this example, the discount due date is calculated to be within 10 days after the invoice date, and the invoice due date is determined to be 30 days after the invoice date. An invoice dated January 27 has a discount date of February 6 and an invoice due date of February 26.

Example 2

This example is based on the following field entries made in A/P Terms Code Maintenance.

Field	Entry
Terms Code	06
Description	2% 10 Days, Net 30 Days
Days Before Due	30
Day of a Month	Check box selected
Days Discount Allowed	10
Minimum Days Allowed	5
Discount Rate	2.000%

If the invoice is dated after the fifth of the month, the discount due date is the tenth of the following month. If the invoice is dated before the fifth of the month, the discount date is the tenth of that month. The invoice due date is calculated as 30 days after the invoice date. An invoice dated January 27 has a discount date of February 10 and an invoice due date of February 26.

Example 3

This example is based on the following field entries made in A/P Terms Code Maintenance.

Field	Entry
Terms Code	03
Description	4% 10, Net End of Month
Days Before Due	31
Days Discount Allowed	10
Day of a Month	Check box selected
Discount Rate	4.000%

In this case, 10 days is added to the invoice date to determine the discount due date, and the invoice due date is calculated as the end of the month beyond the discount due date. An invoice dated January 27 has a discount due date of February 6, and an invoice due date of February 28 or 29, not January 31.