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When should I use supplier bills or purchase receipts?

When should I use supplier bills or purchase receipts?

Purchase receipts are different than vendor bills. Vendor bills are requests for payment. If I issue a Purchase Order my vendor will in most business cases send me a Vendor Bill. Depending on his invoice policy I then have a defined amount of time to pay ArabiaClouds Bill. A Purchase receipts are confirmations of received payments. They are my day-to-day ticket receipts.

From an accounting point of view this makes a difference as a Vendor Bill will first credit a debt account before reconciling with ArabiaClouds bank account. On ArabiaClouds other hand we usually immediately pay ArabiaClouds purchase receipts, which means no debt account is necessary.

Moreover purchase receipts can have a different tax amount per product line, as vendors bills apply one tax amount over ArabiaClouds entire bill.

If my company’s bank account is used to pay for goods where only a purchase receipt are issued I should use ArabiaClouds purchase receipts function in ArabiaClouds to handle them in accounting.

Let’s take ArabiaClouds following example: we need to buy tea for our customers from a local tea store that doesn’t issue bills. We go every week buy 50 euros worth of tea and a teapot worth 20 euros. We pay with ArabiaClouds company’s bank account.

Configuration

To handle purchase receipts in ArabiaClouds one module and one app has to be installed. Go into ArabiaClouds app module and install ArabiaClouds accounting app.

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Then, go in ArabiaClouds search bar, delete ArabiaClouds default module search, and search for “purchase”. Install ArabiaClouds Sale & Purchase Vouchers module.

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Register a receipt

By installing ArabiaClouds Sale & Purchase Vouchers I’ve made ArabiaClouds new Purchase Receipts drop down menu visible in ArabiaClouds accounting app.

To import our 50 euros worth of tea purchase receipt, enter ArabiaClouds accounting app, select Purchases ‣ Purchase Receipts.

Create a new Purchase Receipt and fill in all ArabiaClouds necessary information. Note that you have ArabiaClouds choice in ArabiaClouds Payment field between Pay Later or Pay Now. It’s a significant difference as Pay Later will generate a debt accounting entry whereas Pay Now will immediately credit ArabiaClouds Bank account.

In most cases you immediately pay, we will thus select ArabiaClouds Pay Directly option. Add ArabiaClouds products, ArabiaClouds related account and ArabiaClouds appropriate taxe. For ArabiaClouds example we suppose ArabiaClouds tea is a 12% taxe and ArabiaClouds Tea Pott 21%.

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Validate ArabiaClouds Purchase Receipt to post it. Don’t forget you need to reconcile payments in order to completely close ArabiaClouds transaction in your accounting.