Terms OF Payment:
It means when u dealing with any customer or vendor what are the terms that are set for the payment of invoice,How may credit days are allowed to him or wht discount he is eligible for if he makes early payment and so on... if he pays in cash wht is terms and like discaount ... and if by cheque or any other mode what are the terms....
for more clearly say
u deal that if the customer has an invoice of 500000 and his credit limit days is 30 days,,, so
we can make a term of payment 0001 in that
1.if he pays in 10 days 2% discount is given on total amount
2. if he pays in 20 days 1% discount is given on total amount.
3. if he pays in 30 days 0% discount is given
4. if he pays in 45 days 1% interes thas to be charge for late payment.... and so on.....
in case of vendor how much discout we earn if we pay in regular or early payment.
so for different vendors and customers we have different senerios and situations so that is to be difined under terms of payment.
INTEREST INDICATOR:
Interest indicator defines the Rate of interest..
offenly in business senerios we need to pay or take interest,
that too have different senerios like if we take a loan from bank we need to pay 9% p.a interest..
so indicator is made with all the time dependent informationa and all other information like wht is the time interval to calculate the interest on what amount to calculate the interest... from when to start. and so on....
so each time u need not to add all such information
hope it clearfy ur doubt,....
sejal
assign points if useful
You must be a registered user to add a comment. If you've already registered, sign in. Otherwise, register and sign in.