Learn how to properly configure payment methods in Dynamics 365 Finance to reimburse expenses reported by third-party service providers. The two correct methods are explained in detail.
Table of Contents
Question
A company implements Dynamics 365 Finance. The company uses a third party to provide support services.
You need to configure a payment method to allow the company to reimburse any expenses reported by the third-party service provider.
Which two methods should you use? Each correct answer presents a complete solution.
NOTE: Each correct selection is worth one point.
A. Vendor
B. Bank
C. Worker
D. Ledger
Answer
To allow your company to reimburse expenses reported by a third-party service provider in Dynamics 365 Finance, the two methods you should configure are:
A. Vendor
D. Ledger
Explanation
Vendor is the correct method because the third-party service provider is an external entity providing services to your company. In Dynamics 365 Finance, a vendor represents an organization or person that provides goods or services and needs to be paid. By setting up the third-party as a vendor, you can track the expenses they report and generate payments to reimburse them.
Ledger is also a correct method because the reported expenses and reimbursement payments need to be recorded in your company’s financial ledger accounts. The ledger in Dynamics 365 Finance is used to define the chart of accounts, accounting currencies, calendars, and other settings that impact financial transactions. Expense transactions from the vendor need to be posted to the appropriate expense accounts in the ledger, and the payment to the vendor needs to be posted to the appropriate payable account.
The other two options, Bank and Worker, are incorrect:
- Bank is used to set up company bank accounts, not to reimburse third-party expenses.
- Worker refers to employees in the company, but the third-party service provider is a vendor, not an internal worker.
In summary, to reimburse expenses reported by a third-party service provider, the two methods that need to be configured in Dynamics 365 Finance are Vendor, to set them up as a payable entity, and Ledger, to ensure the expenses and payments are recorded in the proper financial accounts. Configuring these settings correctly is essential for accurate tracking and financial reporting of third-party expenses.
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