Cash Discount Base Amount

Definition

Part of the invoiced amount for which cash discount is granted.

Use

The system uses the cash discount base amount to calculate the cash discount amount based on the percentages in the payment terms, if you have not entered the cash discount amount manually. If the system is to calculate the basis amount, you need to leave the Cash Discount Base field empty.

The system determines the cash discount base by adding the amounts from the fixed asset account items and G/L account items that are relevant for the cash discount. The items that do not have an entry in the Without Cash Discount field are relevant for the cash discount. Meaning that during posting you can determine whether each fixed asset account item and G/L account item is relevant for the cash discount.

Structure

Cash Discount Base Amount and Tax

For the tax document items, you need to specify whether the tax amount is relevant for cash discount. You specify this when defining a company code in Cash Discount Base Is Net Value.

  • If you set the Cash Discount Base Is Net Value indicator, the system ignores the tax items when determining the cash discount base amount. For example, this applies in France where the tax amount is not relevant for cash discount.

  • If you do not set the Cash Discount Base Is Net Value indicator, the system considers the tax amounts when determining the cash discount base amount.

Example

When posting an invoice, you entered the following G/L account items:

Postings Relevant for Cash Discount and Postings Not Relevant for Cash Discount

Account Name

Amount

Without Cash Discount

Equipment

100,000

Freight

1,000

X

Assembly fees

2,000

X

Input tax

14,420

If you have defined that the tax is relevant for the cash discount for the company code, the system determines a cash discount base amount of EUR 114,420. Otherwise the cash discount base amount is EUR 100,000.

If a document contains more than one item for a vendor account or customer account, the system determines the proportional cash discount base amount per item. The items in which you have entered the base amount manually are not taken into account.