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Rebate Calculation

Dec 06, 2016 at 06:20 PM

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Dear All,

Please assist with the below requirement if possible.

A billing document is posted with rebate percentage applied say 10%. At a subsequent time, a price change (credit memo) is to be created with reference to the initial billing document, with a manual discount applied . By standard, the accounting entries should be the reverse of the initial posting.

At the point of credit memo posting, Is it possible, instead of a debit to the provision for rebate account and a credit to the sales rebate account of the total amount initially posted in the billing document, the amount to be posted should be rebate percentage on the net (initial sales value - manual discount applied).

Sample account entry below

Billing document

Dr Customer 68,000

Cr Revenue and VAT (60,000 and 8,000)

Cr Provision for rebate 6000

Dr Sales rebate 6000

Credit Memo (manual discount 1000 applied)

Cr Customer 67,000

Dr Revenue and VAT (same as above)

Dr Provision for rebate (10% rebate on discounted sales price)

Cr Sales rebate (10% rebate on discounted sales price)

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3 Answers

Typewriter TW Dec 08, 2016 at 03:29 PM
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Unclear and narrated in a difficult manner.

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Lilian Elizabeth Dec 09, 2016 at 10:22 AM
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A credit memo is created with reference to a billing document which has rebate amount accrued. During creation of credit memo, a manual discount is applied. This reduces the sales price copied from the initial billing document. Is it possible to configure in such as way that the rebate amount is also recalculated at that point as well?

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Typewriter TW Dec 24, 2016 at 08:21 PM
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Theoretically, yes, rebate or accrual amount can be calculated in any billing document.

1. The billing type (credit memo type) must be activated for rebates - configuration

2. The rebate condition types must be included in the pricing procedure assigned to this credit memo type.

3. The value of these rebate condition types is calculated from the Base value, setup in "From" in the pricing procedure.

Question:

Why does business give a manual discount in the credit memo process?

Comment:

This credit memo rebate amount will reduce the accruals in the rebate agreement. Would you agree?

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