Calculation of first due date
The calculation of the first due date depends on several user-defined variables:
- The number of days between the invoice and the first obligation is used to calculate the date of the first obligation.
- The days for adjustment, if specified, are also used to calculate the date of the first obligation. Days for adjustment are used when a calculated due date falls between two fixed days of the month.
- Multiple obligations are adjusted by the days between payments to be at least that many days between obligations. A number that is larger than the number of days between the fixed payment days can cause a fixed payment day to be skipped. This depends on the size of the adjustment days range.
Example
This example shows the obligation structure of a fixed days terms code. Assume this information about the sample invoice:
| Variable | Value |
|---|---|
| Number of payments | 7 |
| Days between invoice and first due date | 10 |
| Days between payments | 8 |
| Fixed payments days of month | 5 15 25 |
| Fixed payments days for adjustment | 3 |
If the number of obligations is 7 and the days of the month are 5, 15 and 25, then seven obligations are created. The due dates are the 5th, 15th and the 25th, alternating until all seven obligations are created.
If the number of days between the invoice and the first obligation falls on the 27th and the days for adjustment is 3, then the first obligation can be adjusted by three days. There must be an earlier date to use as the first obligation.
In this case, the invoice date plus the days between the invoice date and the first due date is 27. The 25th is within the three day adjustment range. From this set of variables, the first obligation date is the 25th.