What is payment method in sap?
While paying to a vendor or receiving payments from customers we use different payment methods to pay or receive money.
These payment methods are one digit code that indicates the type of payment used for a vendor or customer. These codes can be in letter or number i.e. it can be alphanumeric.
Example of payment methods are C= cheques, D= Direct deposit, T = Bank transfer.
These payment methods are used in vendor or customer master. Once it is created the payment methods will be defaulted at each payment posting. You have option to change the defaulted payment method while posting the transaction.
What is electronic bank statement?
Bank accounts which are used for payment to vendors or required to receive from customers.
At the end of the period, bank will issue a statement of our business account maintained with them. This can be sent on paper format or electronic statement. These electronic bank statements will contain cheques received/paid, bank interest, bank charges, cash withdrawals and deposit.
We need to compare this electronic bank statement with our companies bank account to know if any entry has been missed out or anything extra has been charged by the bank which the business is unaware. This reconciliation process is called bank reconciliation.
If the bank statement is in electronic format then it’s very easy to prepare bank reconciliation statement provided you have the right configuration in place.
What is residual payment?
Residual payments are a method of clearing open item transactions. In sap we maintain open item transactions which are cleared with another open item transaction. If you are clearing any payment by using residual payment method then system will clear the original open item and pass another line item as open item for the balance amount remained after such payment.
For example: suppose we have received an invoice for Rs. 12, 000. Now the customer is making payment for Rs. 4, 000. If we use residual payment method then system will clear the original invoice of Rs. 12, 000 and another open item will be passed with the balance amount of Rs. 6, 000.
What is dunning in sap?
In business different customers enjoy different credit facilities. They need to pay their dues before the due date but most of them do not pay by the due date. Dunning is a process in sap by which you can issue notices to default customers for timely payment.
What is reason code in sap?
For any over payment or under payment to a customer we need to specify reason code to it. Reason code will specify the reason of such under or over payment to customers.
Reason codes are valid for one company code.
Following things are determined by a reason code;
- Whether the difference due to over payment or under payment should be charged to a separate gl account or residual posting should be done for such difference amount.
- Correspondence to the customer can be generated by informing them about the residual item treatment in your company.