Learn how to effectively configure vendor prepayments and deposits in Microsoft Dynamics 365 Business Central. Discover the best practices for handling prepayments, ensuring accurate accounting, and improving financial management. Explore essential tips for successful prepayment configurations in this step-by-step guide.
Table of Contents
Question
Your company requires a method to manage vendor prepayments and deposits effectively.
You need to configure the system to handle prepayments and ensure accurate accounting for these transactions.
What should you do?
A. Set up a fixed prepayment amount for all vendors regardless of the invoice value.
B. Disable prepayment functionality as it complicates financial reporting.
C. Implement a manual tracking system for prepayments outside of Business Central.
D. Configure prepayment percentages on vendor cards and link them to prepayment general ledger accounts.
Answer
D. Configure prepayment percentages on vendor cards and link them to prepayment general ledger accounts.
Explanation
Configuring prepayment percentages on vendor cards and linking them to prepayment general ledger accounts is the correct approach to managing vendor prepayments. Setting a fixed prepayment amount for all vendors does not account for varying invoice values. Disabling prepayment functionality is not an option for a bank that requires this feature. Implementing a manual tracking system is inefficient and prone to errors.
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