Example of Using Applied Documents

Reference, adjusted, and applied documents can impact tax calculation based on the documents they are associated with. The Tax Simulator presents information on some of the impacts.

Scenario

An example of an applied document that impacts tax calculation is that of a Receivables credit memo that references an invoice. In Receivables there can be standalone credit memos that drive tax calculation based on the tax attributes entered on the credit memo and there are applied credit memos that drive tax calculation based on the referenced document; the invoice. If there is a credit memo that isn't calculating what you expected in Receivables, you can:

• Copy the transaction into the Tax Simulator.

• Simulate each document independently and associate them in the user interface. The Tax Simulator doesn't associate documents.

• Review the credit memo tax lines independently before the transaction association and see that the tax calculation is based on the attributes entered on the credit memo.

• Associate the invoice in the Reference, Adjusted, and Applied tab with the appropriate document number and line and drill to the tax lines. See that the result type value for the rule results is derived from the reference document. This indicates that the tax isn't based on the credit memo attributes but those of the invoice.