Example 1: Balance Forward Customer (Customer is not part of a National Account)

The following example shows how Automatic Cash Application Audit (AR130) processes open records for a balance forward customer, when the customer is not part of a National Account relationship.

Transaction number Deposit/Due date Open amount
Payment 101 10/17 200.00
Payment 105 10/21 250.00
Payment 102 10/30 100.00
Credit memo 201 10/27 70.00
Credit memo 202 11/05 140.00
Invoice 301 10/10 150.00
Invoice 302 10/14 90.00
Debit Memo 401 10/22 40.00
Invoice 303 10/29 100.00
Debit memo 402 11/03 100.00
Invoice 304 11/07 200.00

The application order and application amounts are as follows.

  1. Payment 101 (200.00) is applied to invoice 301 (150.00). An applied record (150.00) is created for the fully applied invoice 301.
  2. The remaining 50.00 from payment 101 is then applied to the next oldest invoice or debit memo, invoice 302 (90.00). An applied record (50.00) is created for the partially applied invoice 302.
  3. The next oldest open payment, payment 105 (250.00), is applied to the remaining 40.00 from invoice 302, creating a second applied record (40.00) for the fully applied invoice 302.
  4. The remaining 210.00 from payment 105 is then applied to the next oldest invoice or debit memo, debit memo 401 (40.00), creating an applied record (40.00) for the fully applied debit memo 401.
  5. The remaining 170.00 from payment 105 is then applied to the next oldest invoice or debit memo, invoice 303 (100.00), creating an applied record (100.00) for the fully applied invoice 303.
  6. The remaining 70.00 from payment 105 is then applied to the next oldest invoice or debit memo, debit memo 402 (100.00), creating an applied record (70.00) for the partially applied debit memo 402.
  7. The next oldest open payment, payment 102 (100.00), is applied to the remaining 30.00 from debit memo 402, creating a second applied record (30.00) for the fully applied debit memo 402.
  8. The remaining 70.00 from payment 102 is then applied to the next oldest open item, invoice 304 (200.00), creating an applied record (70.00) for the partially applied invoice 304.
  9. With all payments applied, credit memo 201 (70.00) is applied to invoice 304. An applied record (70.00) is created for the partially applied invoice 304.
  10. Credit memo 202 (140.00) is applied to invoice 304. An applied record (60.00) is created for the fully applied invoice 304. This leaves credit memo 202 partially applied with a (80.00) balance.