Offset Accounts Payable Vendor with Accounts Receivable Customer in Sage 100

Have you ever encountered a vendor who also was a customer? In this unique situation, the balance in accounts payable can be offset with the balance in accounts receivable.

Here’s an example:

SPL & Associates has an Accounts Payable invoice of $625.
Offset Accounts Payable Vendor with Accounts Receivable Customer in Sage 100

Customer 02-SPL has an Accounts Receivable balance of $14,457.50. (Note:  The customer number and vendor number don’t need to be the same).
Offset Accounts Payable Vendor with Accounts Receivable Customer in Sage 100

First in Accounts Payable | Setup | Vendor and Customer Link Maintenance, select the customer, then select the vendor and click “Accept” to accept the link.
Offset Accounts Payable Vendor with Accounts Receivable Customer in Sage 100

Next, offset AP with the AR balance.

In Accounts Payable | Period End, select “AP from AR Clearing Selection.”
Offset Accounts Payable Vendor with Accounts Receivable Customer in Sage 100

Select “Proceed.” Select the printer to run the AP from AR Clearing Register.
Offset Accounts Payable Vendor with Accounts Receivable Customer in Sage 100

Select “Yes” to update the register.
Offset Accounts Payable Vendor with Accounts Receivable Customer in Sage 100

Print the Daily Transaction Register.
Offset Accounts Payable Vendor with Accounts Receivable Customer in Sage 100

Select “Yes” to update the Daily Transaction Register to ensure the AP trail balance and AR trail balance both will balance to the general ledger.

A review of your vendor will show the update:
Offset Accounts Payable Vendor with Accounts Receivable Customer in Sage 100

A review of your customer also reflects the new information:
Offset Accounts Payable Vendor with Accounts Receivable Customer in Sage 100

Note that bank code Z is used during the clearing process.

After the update, the customer has a clearing payment for individual invoices, and the vendor has either a debit or credit invoice posted to the account balance. AP invoices don’t have individual invoice postings. The debit or credit invoice posted to AP can be processed like invoices entered using Accounts Payable Invoice Data Entry. This invoice can be paid or applied to another invoice during manual payment entry by using General Ledger Distribution.

To learn more about this topic or others, contact a BKD Technologies Sage professional.

Colleen Gutirrez

Colleen, a senior consultant with BKD Technologies, has more than 18 years of experience as a technology consultant, performing needs assessments and analyses and providing system selections, implementations, installations, training and support for a variety of industries. She also implements, supports and provides training on Sage ERP 100 and 500 accounting applications and Sage Intelligence.

Colleen Gutirrez – who has written posts on Sage ERP Insights.


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