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To make things easy, we will generate a report for only one customer.
3 In the As of Date field, enter or select March 25, 2003.

4 Place your mouse pointer in the From field of the Customer ID filter line.

Select ARMSTRONG-01 and press e.
5
The Type field changes automatically to Range.
6 In the To field, select ARMSTRONG-01 again.




7 Select OK to display the report.




The Sales Backorder Report displays only the open sales orders as of the date
specified. Our report displays the five remaining bird house kits on order.
Once we purchase and receive additional kits from the vendor, we can issue a
second invoice to our customer for the remaining five items ordered. This will
close the sales order.
If we had displayed the Sales Backorder Report before posting the sales
invoice, this report would have displayed eight bird house kits on order with
three on hand.




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Lesson V”Accounts Receivable
Entering a Cash Receipt


Entering a Cash Receipt
Now we are going to enter a receipt from Armstrong Manor for the amount
we just invoiced.
1 From the Tasks menu, select Receipts.




Notice the similarities between the Receipts window and the Payments
window. There are a few differences including the addition of the
Deposit ticket ID and Payment Method fields. The Check Number field
in Payments is replaced by a Reference field in Receipts.
2 The cursor is in the Deposit ticket ID field. This field defaults to today™s date
and is used to combine receipts for fast account reconciliation with bank
statements. Press e.
You have the option of entering a receipt from a customer or a vendor.
Usually receipts come from customers. However, you might receive a
refund check from a vendor.
Type A and press e. The customer Armstrong Manor displays. The
3
cursor moves to the Reference field.
The Apply to Invoices tab now displays the sales invoice 9901 we just
entered. If the customer had other invoices due, they would also display
here.
If you wanted to enter a cash sale (for example, a walk-in sale) without
creating a customer ID or sales invoice, you could skip the Customer ID
field and enter the name of the one-time customer in the Name field.



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4 Type 101 in the Reference field for the customer™s check. This is a required
field. Press e. The cursor moves to the Date Field.

In the date field, type 29 and press e. The date formats to
5
Mar 29, 2003.
The cursor moves to the Payment Method field. Peachtree Accounting
allows you to enter up to 10 payment methods. These are set up in the
Customer Defaults window.
Select Check from the Payment Method drop-down list and press e.
6
The cursor moves to the Cash Account field.

Select 10200”Regular Checking for the cash account. Press e.
7

Below the Cash Account field is the current balance (as of the check date
3/29/03). If question marks display, select the Recalculate (Recalc)
button to display the current balance. This displayed balance will not
change until you select the Recalculate button again.
At this point, you can select invoices to pay. Optionally, you can enter a
receipt against a sales income account. When you select the Apply to
Sales tab, the outstanding invoices for this customer will temporarily
disappear, and the columns in the distribution area will be different
(similar to the sales invoice). We are going to apply this receipt against
an invoice.
8 On the Apply to Invoices tab, check the Pay box in the far right column
beside invoice 9901.
Notice that the Receipt Amount box on the check form now displays
$736.10. This is $751.12 minus a 2% discount extended to Armstrong
Manor (established in default customer terms).
The Receipt Amount box shows a running total of the customer
invoice(s) paid. You can only adjust the amount it shows indirectly by
entering payments in the Amount Paid field.

9 Select the Post button to record and post this receipt.
You cannot print cash receipts.
10 Press q to close the Receipts window.




128
Lesson V”Accounts Receivable
Analyzing Customer Payments


Cash Receipts Transactions
When you post this receipt, the accounts receivable account is credited for the
full invoice amount. This balances the debit created when we entered the
invoice. The cash account is debited (increased) by the amount of the check,
and the sales discounts account is increased by any discount that might apply.
(You establish the discount for sales by selecting Default Information from
the Maintain menu, and then Customers.)

Analyzing Customer Payments
Now we are going to look at how well Bellwether Garden Supply manages its
collections of payments from customers. Obviously, they don™t have a
problem with the invoice we just entered. They just need to ship Armstrong
Manor the remaining items (currently on backorder) to close the sales order,
and then invoice the remaining sale. However, to look at other customers and
aging amounts, we™ll use the Collection Manager.


Using the Collection Manager
The Collection Manager allows you to analyze, on three different levels, the
outstanding invoices owed by customers.
The first (Graph) level provides a graphical representation of outstanding
invoices and the aging brackets the invoices fall into. You can select a bracket
from this level and drill drown to a detailed view of the amounts in this level.
1 From the Analysis menu, select Collection Manager. The first level of the
Collection Manager appears.




Notice the four aging brackets, along the horizontal or X axis. The
vertical or Y axis shows dollar amounts due.


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2 Select the Bracket button.
Here we see the age of the invoice in days, the customer name, the
invoice number, the document date, (transaction date), the due date, the
total amount due, and the option to print a collection letter.

3 Move the highlight bar using your arrow keys to an invoice with Ertley
Bulldog Sports. Select the Source button.
At this level, we see all the outstanding invoices for Ertley Bulldog Sports
and their respective ages. You can send a collection letter from this
window by selecting the Letter button from the toolbar.
4 Select Close to exit the Collection Manager and return to the Main Menu.
For more information on the Collection Manager, refer to the “Business
Analysis” chapter of the User™s Guide.

Review of Lesson V
Let™s review some of the things we learned in this lesson.
• We covered the basic accounts receivable tasks:
• Entering prospects and customer records
• Preparing proposals using quotes
• Printing quotes
• Ordering items using sales orders
• Shipping items and applying sales orders to sales invoices
• Applying a receipt against the sales invoice
• The number of accounts receivable tasks you™ll use depends on your
business situation. If you want to bill a customer now and let them
pay for it later, use the Sales/Invoicing window. If it™s a direct cash
sale and no invoice is required, enter it in the Receipts window using
the Apply to Revenue tab.
• Product and Service invoice templates are available from the Quotes
and Sales/Invoicing windows:
Product template: This data-entry window displays all available

data-entry fields and can be used for products or services. If you
track inventory, you should use this mode.
Service template: This data-entry window allows you to print an

invoice for services (only). If you don™t track inventory items, you
can use this mode for easier data entry.



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Lesson V”Accounts Receivable
Review of Lesson V


• While in a task window, you can enter a customer (or anything
contained within a lookup box) on-the-fly by pressing + or double-
clicking the ID look-up field (except jobs).
• Most ID codes in the program can be any combination of letters and
numbers up to 20 characters long. You should establish a consistent,
logical coding system, so others in your company will know how to
code a new vendor/customer, or how to find a previously entered
one.
• Quotes are proposals you want to give a customer that outline a
possible sale.
• Sales orders are used when your customer agrees to the sale but you
are not ready to ship or sell the entire order. Quotes can be converted
to sales orders to avoid additional data entry. The service or
inventory items are ordered for the customer”either packaged by
your shipping department or issued to your staff to schedule
services. You can print sales orders and include them as packing slips
when shipping items to your customer. Warehouse personnel can
also mark up a printed sales order to determine what was shipped
and what needs to be put on order.
• Sales invoices are entered once you actually ship items or render
services. A sales invoice can apply only to one sales order at a time.
Once the sales invoice is posted, the accounting information is
entered into the General Ledger (in accrual-based companies).
• If you attempt to sell an item beyond the current stock level, you may
receive up to two warning messages. Both messages are an optional
setting in the Maintain Global Options window.
Global Out of Stock Warning Message: This message warns that

you are selling one or more items that are out of stock when you
select the All button. The item is not identified. The quantities
(for items out of stock) in the Shipped column are set back to
zero.
Individual Item Out of Stock Warning Message: This message

warns that you are selling a particular item and displays the
current stock level. This is a system-generated message. If you
proceed, the item will be sold beyond the current stock level.
• If you want Peachtree Accounting to print a sales invoice, leave the
Invoice # blank.
• Peachtree Accounting uses sales orders and invoices you have
entered to determine if you have over-sold stock or assembly items.
To determine if you still have items remaining on order after you
have posted a sales invoice, look at the Sales Order or Sales Backorder
report.


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• In accrual-based companies, entering typical invoices debits the
accounts receivable subsidiary, and distributes the offsetting credit to
the applicable income and sales tax payable accounts. If inventory
items are used, inventory accounts are credited and cost of goods
sold accounts debited.
• If you want to look at a graphical overview of all outstanding
invoices from customers, use the Collection Manager™s Graph level.
To zoom in on all outstanding invoices by aging bracket, use the
Collection Manager Bracket level. If you want to view all outstanding
invoices for just one customer for an aging bracket, use the
Collection Manager Detail level.
Now that you have been introduced to the Accounts Receivable module of
Peachtree Accounting, you are ready to proceed to Lesson VI”Payroll.




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