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Payment Terms Codes [FM]

Payment Terms Codes​

From the DockMaster menu, select File Maintenance > Payment Terms Codes

Payment Terms Codes are used to define the different invoice terms for A/R Customers and A/P Vendors. The Terms Codes control the discounts, the discount due dates, and the invoice due dates extended to a customer by you or to you by a vendor. These codes are attached to a customer through the Customer File and to a vendor through the Vendor File.

Note: Each customer and vendor can only have one default payment term code.

Whenever you enter an invoice transaction for a customer or vendor in the DockMaster system, the payment terms are applied and a due date is calculated.

Below are some examples of commonly used codes:
30 Net Due 30 Days 00 Due Upon Receipt
10 Net Due 10 Days 230 2/10, Net 30 Days

  • Payment Terms Code - Enter any combination of up to 3 letters or numbers or press F6 to get a list of existing codes.
  • Description - Enter a Description of the code.
  • Due - Enter the number of days until the first payment is due (i.e. 10, 15, 30) or the day of the month that the payment is due (i.e. 1st, 22nd, 30th).
  • Click on the 'th of the Month' or 'Days from Invoice Date' radio buttons to differentiate the calculation method to the computer. The ‘th of the Month’ signifies that the days entered in the Due box is the actual day of the month the payment is due; the ‘Days from Invoice Date’ signifies that the days entered in the Due box are the number of days until the payment is due.

A/R and A/P calculate invoice due dates using the following formula:
Due Date = Invoice Date + Days Til Due

  • The Discount Rates grid allows you to enter discount days and rate information to automatically calculate discounts in the Accounts Receivable and Accounts Payable modules.
  • Discount Days - Enter the number of days after the invoice date within which you or your customer can receive a discount for early payment. For example, if the customer receives a 2% discount if paid within 10 days and the invoice is due in 30 days, then the Discount Days would be 10.
  • When you enter the customer payments in the A/R Cash Receipts Entry program, the software calculates the invoice discount due date using the following formula:

Discount Date = Invoice Date + Discount Days

  • If, in A/R Cash Receipts Entry or Print A/P Checks, you enter an early payment transaction on or before the discount date, the software automatically calculates the discount for you.

If the payment is within the early payment period but does not pay off the net invoice amount (gross invoice - discount amount), then the system will not calculate the discount.

  • Nth of Month - Click on the Nth of Month box if the figure entered in the Discount Days column signifies the actual day in the month the discount is available. Leave the box clear to signify that the discount days is the number of days after the invoice date that you can take the discount.
  • Discount Rate - Enter the Discount Rate available to a customer or vendor if an invoice is paid on or before the discount date. The rate should be entered as a whole number. For example, a 2% discount can be entered as 2, 2%, 2.0, or 2.0%.
  • When you enter a payment in A/R Cash Receipts Entry, the software checks the customer's payment terms code. Using the discount rate for that code, the software calculates the total early payment discount that can be received if you or your customer pays on or before the discount due date. A/R and A/P calculate discount amounts using the following formula:

Discount Amount = Discount Rate x Invoice Total