Automating Vendor Payment Posting in Microsoft Dynamics 365 Business Central
Question
A company purchases items by using cash.
You register a vendor payment when you a post a purchase invoice for a cash vendor.
You are creating a new cash vendor.
No prior vendors have been set up as cash vendors.
You need to set up the vendor so that payments post automatically when you post a purchase invoice.
Which type of setup should you use?
Answers
Explanations
Click on the arrows to vote for the correct answer
A. B. C. D.C.
https://docs.microsoft.com/en-gb/dynamics365/business-central/finance-how-to-settle-purchase-invoices-promptlyTo set up a vendor so that payments post automatically when a purchase invoice is posted, you need to select the correct payment method in the vendor card.
Option A: Payment Method as Cash: Selecting payment method as cash means that payments will be made in cash at the time of purchase. However, this option does not automatically post vendor payments when a purchase invoice is posted.
Option B: Payment Term as COD: COD stands for "cash on delivery," which means that payment is made in cash when the goods are delivered. This option also does not automatically post vendor payments when a purchase invoice is posted.
Option C: Payment Method as Cash with balancing account: Selecting payment method as cash with a balancing account means that payments will be made in cash, and the payment will be automatically posted to the balancing account when a purchase invoice is posted. This option is the correct setup to automatically post vendor payments when a purchase invoice is posted.
Option D: Prepayment: Prepayment means that payment is made in advance, before the goods or services are received. This option is not suitable for the scenario described in the question, where the company purchases items by using cash.
Therefore, the correct answer is C, Payment Method as Cash with balancing account.
