Example 3: Balance Forward Customer (Customers 1 and 2 are part of a National Account and AR130 National Accounts Credits set to N)

The following example shows how Automatic Cash Application Audit (AR130) processes open records for a balance forward customer, when customers 1 and 2 are part of a National Account relationship and on AR130, the National Accounts Credits field is set to No.

Note: In this example, the AR130 Payment Batch Number field is not entered.
Customer Transaction number Deposit/due date Open amount
1 Payment 101 10/17 200.00
2 Payment 105 10/21 250.00
1 Payment 102 10/30 100.00
2 Credit memo 201 10/27 70.00
1 Credit memo 202 11/05 140.00
2 Invoice 301 10/10 150.00
1 Invoice 302 10/14 90.00
1 Debit memo 401 10/22 40.00
2 Invoice 303 10/29 100.00
2 Debit memo 402 11/03 100.00
1 Invoice 304 11/07 200.00

The application order and application amounts are as follows.

  1. Payment 101 (200.00) is applied to credit memo 202 (140.00). An applied record (140.00) is created for the fully applied credit memo 202. Payment 101 open amount is 340.00.
  2. Payment 101 is applied to invoice 301 (150.00). An applied record (150.00) is created for the fully applied invoice 301.
  3. The remaining 190.00 from payment 101 is then applied to the next oldest invoice or debit memo; invoice 302 (90.00). An applied record (90.00) is created for the fully applied invoice 302.
  4. The remaining 100.00 from payment 101 is then applied to the next oldest invoice or debit memo; debit memo 401 (40.00). An applied record (40.00) is created for the fully applied debit memo 401.
  5. The remaining 60.00 from payment 101 is then applied to the next oldest invoice or debit memo, invoice 303 (100.00). An applied record (60.00) is created for the partially applied invoice 303.
  6. The next payment for customer 1, payment 102 (100.00), is used to continue the application process. An applied record (40.00) is created for the fully applied invoice 303.
  7. The remaining 60.00 from payment 102 is then applied to the next oldest invoice or debit memo, debit memo 402 (100.00). An applied record (60.00) is created for the partially applied debit memo 402.
  8. The next payment for customer 2, payment 105 (250.00) is applied to credit memo 201 (70.00). An applied record (70.00) is created for the fully applied credit memo 202. Payment 105 open amount is 320.00.
  9. The remaining 320.00 from payment 105 is then applied to the next oldest open invoice or debit memo; debit memo 402. An applied record (40.00) is create for the fully applied debit memo 402.
  10. The remaining 280.00 from payment 105 is then applied to the next oldest open invoice or debit memo; invoice 304. An applied record (200.00) is created for the fully applied invoice 302. This leaves payment 105 partially applied with a 80.00 balance.