Posting A/R Draft Payments
Next, based on the due date of the draft and when you wish to receive the cash (at due date or before the due date), perform a draft remittance using the A/R Posting Draft Remittance form.
After the draft remittance, post the draft. Posting the draft changes the status of the draft to Remitted and creates a journal entry from the Draft Receivable account to either the Draft Remitted account or the Draft Discounted account identified in the Bank Address form.
Posting prepares entries for the AR DIST journal as shown here.
These journal entries are created with the A/R Posting Draft Remittance form:
- Debit: Drafts Remitted
- Credit: Drafts Receivable
For discounted drafts, these journal entries are created:
- Debit: Drafts Remitted
- Credit: Draft Discounted Receivable
When the bank tells you it has given you the money, use the Bank Reconciliations form to perform a draft deposit. The deposit updates the draft status to its final value of Paid and creates the new journal entry that finally impacts the Cash account.
These journal entries are created when you reconcile draft payment deposits in the Bank Reconciliations form:
- Debit: Cash
- Credit: Drafts Remitted