payment terms

[Former Member]

Please explain the payment terms and how it could be use?

Please explain detai?

thanks in advance

[Former Member · Accepted solution]

Hi,

In this menu option, you define the terms of payment for the customer master records required for sales and distribution. Specify the terms of payment in the customer master records. From there, the SAP System automatically copies them into the sales documents at header and item level.

Depending on the item category, the terms of payment can differ at header and item level (see the section "Define item categories for sales documents").

Aspects of accounting such as cash discount periods, cash discount rates and due date for net payment in the invoice are defined and managed in financial accounting (module FI) (see FI section "Define terms of payment").

Using the defined cash discount rate, the SAP System determines the corresponding cash discount amount in pricing for SD documents.

Here, you can also store short texts for the terms of payment which are relevant for sales and distribution. You can then print these short texts on the billing documents.

Bear in mind that the short text for terms of payment in quotations and order confirmations will only be sent by EDI if the day limit is blank. In billing documents the short text will also be sent by EDI if the day limit is not blank.

<b>Note</b>

You can agree on terms of payment with the customer in the SD module separately for each sales area. These agreements may deviate from what is defined in the FI module. The sales area terms of payment are included in a billing document and are transferred to Accounting where they may be overwritten. Considering this, you should work together with Financial Accounting (the FI module) to decide how to maintain terms of payment.

<b>Actions</b>

1. Specify an alphanumeric key with up to four characters for the terms of payment.

2. Enter the explanation as a description.

3. Make sure that the key of the terms of payment is entered in the customer master records.

The payment terms are entered in the customer master data in salea area data - billing screen. The payment terms can also be changed manually in the sales order.

Examples:

30 days due net

100% payment against COD basis

100% payment against proforma invoice

Reward points if solution helps.

Regards,

Allabaqsh G. Patil

[former_member227476]

dear suresh,

payment terms are the terms between customer and business that when the customer has to make the payment

this is depends on the product and depends on the business and depends on the demand for the product and depends on the place it will vary.

0001 Pay immediately w/o deduction

Payable immediately Due net

0002 14 days 2%, 30 net

Within 14 days 2 % cash disc

Within 30 days Due net

0003 14 days 3%, 20/2%, 30 net

Within 14 days 3 % cash disc

Within 20 days 2 % cash disc

Within 30 days Due net

the above mentioned are different kind of payment terms, depends on customer, business will give different kind of payment terms to the customer.

so according to that payment terms customer has to make the payment otherwise finance people will take charge in getting the payment with different dunning levels.

rewards if it helps

siva

[Former Member]

Hi

<b>Terms of payment </b>

Key for defining payment terms composed of cash discount percentages and payment periods.

Use

It is used in sales orders, purchase orders, and invoices. Terms of payment provide information for:

Cash management

Dunning procedures

Payment transactions

Procedure

Data can be entered in the field for the terms of payment key in various ways as you enter a business transaction:

In most business transactions, the system defaults the key specified in the master record of the customer/vendor in question.

In some transactions (for example, credit memos), however, the system does not default the key from the master record. Despite this, you can use the key from the customer/vendor master record by entering "*" in the field.

Regardless of whether or not a key is defaulted from the master record, you can manually enter a key during document entry at:

item level in sales orders

header level in purchase orders and invoices

<b>Note</b>

Master records have separate areas for Financial Accounting, Sales, and Purchasing. You can specify different terms of payment keys in each of these areas. When you then enter a business transaction, the application in question will use the key specified in its area of the master record.

http://help.sap.com/saphelp_470/helpdata/en/93/7433ae546011d1a7020000e829fd11/frameset.htm

[Lakshmipathi]

Hi Suresh

Based on Payment Terms only, overdue statement, Ageing analysis report from FI will flow.

In detail, you are creating a sale order for a customer X with payment terms 60 days credit by oversight, which should have been 30 days. Now in this case, only after 60 days from the billing date, this customer will reflect in your overdue statement.

Hope this satisfies your query. Please reward if this helps you.

Regards

G. Lakshmipathi

[Former Member]

hi ,

Payemnt terms: Agreed payment period after billing the material to customer

eg: For top prior cust you give 1 month credit period where it is not other customers

depending upon on the payment terms you can give discount also

menu path: Spro>IMG>SD>master data>business partner>customer>billing doc>define payment terms>click any one & you can edit

after defining here this input is given in cust master

regards,

Arun prasad

[Former Member]

hi

as per sap help

Arrangements made with a business partner for financial settlement with respect to goods supplied and services performed.

Example:

Stipulation of down-payment (advance payment)

Cash on delivery

Payment following delivery, (for example, clauses "immediate payment in cash," or "on a cash basis," or stipulation of a period for payment)

Combined conditions, (for example, the clause "payable in 30 days net without deduction or within 10 days with 2% discount")

[Former Member]

hi

it means u r taking 10% of the order amount in advance and the balnce 90% after creating the delivery

regards

[Former Member]

my requirement is like, i want 2 create invoice after the sales order for collecting the 10% money(not proforma invoice) and i will give second invoice after delivery,

how i could map in to sap

ANYBODY COULD HELP ON THIS

[Former Member]

hi suresh,

you can't provide invoice as per requierment

For collecting advance you can issue performa invoice after, when you have delivered you can provide complete invoice

regards,

Arun prasad

[Former Member]

The terms of payment consist of cash discount percentages and payment periods.

You use these terms of payment in orders, purchase orders, and invoices. The terms of payment provide information for cash management and forecast, the dunning module, and the payment transactions.

Ex:

0001 Pay immediately w/o deduction

Payable immediately Due net

0002 14 days 2%, 30 net

Within 14 days 2 % cash disc

Within 30 days Due net

0003 14 days 3%, 20/2%, 30 net

Within 14 days 3 % cash disc

Within 20 days 2 % cash disc

Within 30 days Due net

Regards

AK

Reward points if helpful

[Former Member]

if i have payment terms like 10% advance and 90% after the delivery, what is the meaning of this, and how could i determine this

Thanks

[Former Member]

Hi Suresh,

Payment terms define in what fashion and proportion should the payer settle the invoice amount.

10% of the order value must be payed while creating the order and the remaining 90% after the delivery document and PGI is done.

Regards

NP

[Former Member]

Suresh,

As Ayub stated you would also find description like

0002 Within 14 Days 3% Cash Discount

Within 30 Days 2% Cash Discount

Within 45 Days due net.

It means that from the date of invoice if the customer settles the invoice within 14 days you would give him a discount of 3% on the bill, if he settles the invoice after the 14th day and before the 30th day you would give him 2% discount and anytime within 30th and 45th day he would have to pay the full amount. After the 45th day you would levy an additional charge.

Regards

NP