GP Basics: Manual payment Distribution
Do you know how distributions in Manual Payment entry of Payables management are defaulted? In this example post we will see how the distributions are defaulted in Manual Payment entry.
Example: Vendor ABC is mapped to Accounts Payable Account 000-2100-00 and Purchases Account 000-1300-00 in vendor Accounts under Vendor Maintenance.
I. When you create a manual payment entry for this vendor, the default distributions should be as follows
| ACCOUNT | DIST TYPE | DEBIT | CREDIT |
| 000-1100-00 | CASH | - | $1000 |
| 000-2100-00 | PAY | $1000 | - |
Note that in this scenario the payment is created without applying an invoice.
II. In this second scenario, We will first create a vendor Invoice with the following distributions. Instead of the default Accounts Payable, let us select a different account 000-2100-01 under the distribution type PAY.
| ACCOUNT | DIST TYPE | DEBIT | CREDIT |
| 000-1300-00 | PURCH | $1000 | - |
| 000-2100-01 | PAY | - | $1000 |
Now Let us create a manual payment entry for the above invoice and simultaneously apply the invoice. See how the distributions are affected when the payment is applied to invoice above on the fly.
| ACCOUNT | DIST TYPE | DEBIT | CREDIT |
| 000-1100-00 | CASH | - | $1000 |
| 000-2100-01 | PAY | $1000 | - |
The point here is that when a Payment is created without applying the same to an open invoice, the distribution is governed by the default posting accounts mapped to the vendor. Instead, When you create a payment entry, apply it to an open invoice, then the distribution for the type PAY (Which is Accounts Payable) is defaulted from the Invoice distribution entry and not the default vendor posting accounts.
