Partial Payments Result In Partial Payables
The previous example showed the entire tax holding amount being transferred to the tax payable account. The entire holding amount was transferred because the service agreement was paid in full. If a partial payment is received, only part of the holding amount will be transferred to the payable amount (proportional to the amount of receivables reduced by the payment). An example will help make the point.
|
Event |
GL Accounting |
Tax Payable Balance |
Tax Holding Balance |
|
Bill segment created |
A/R 110 Revenue <100> Tax Holding <10> |
0 |
(10) |
|
Partial payment received |
Cash 27.50 A/R <27.50> Tax Holding 2.50 Tax Payable <2.50> |
(2.50) |
(7.50) |
The above example assumes the use of the base product payment segment FT creation algorithm PSEG-AC to transfer the holding amount to the tax payable account. If multiple holding accounts are used, you may want to specify which holding amounts are relieved first. The base product includes an additional payment segment FT creation algorithm C1-FTGL-PSAC that handles booking holding amounts based on a priority.