The following video discusses creating and setting up accounts receivable terms. The video explores accessing accounts receivable terms, creating a new term, best practice recommendations and finalizing accounts receivable terms.
Setting up Accounts Receivable Terms
Key Steps:
Access the settings section and select the terms tab.
Click on the "plus AR term" button to create a new term.
Enter a unique code for the term (e.g., "net 45").
Optionally, provide a description for the term.
Specify the number of days before interest is charged in the cycle.
Define the interest rate to be charged for that term.
Choose whether the term is based on the statement date or the invoice date (preferably invoice date).
Click on "update" to save the AR terms.
Cautionary Notes:
Ensure the code for the term is unique to avoid confusion.
Double-check the interest rate and the number of days before interest is charged for accuracy.
Select the appropriate date basis (invoice date recommended) to avoid payment discrepancies.
Tips for Efficiency:
Keep the term codes and descriptions clear and concise.
Regularly review and update AR terms as needed to reflect current business practices.
Utilize the invoice date option for setting terms to align with most retailers' practices.