To post an invoice as a net amount, a document type that defines posting as a net amount must be entered on the initial screen into the field Document type. In the standard system, this is document type RN.

The cash discount amount expected is already taken into consideration when the invoice is posted. This amount is posted to a cash discount clearing account. The type of price control defined for the material determines which offsetting account is posted when the stock account is posted.

• Material with a moving average price
  The cash discount amount is credited to the stock account and debited to the cash discount clearing account.
• Material with standard price
  The cash discount amount is credited to the account "Income from price differences" and debited to the cash discount clearing account.

The following example shows a net posting for a material with a moving average price.

If an invoice contains a cash discount and taxes, more tax is posted with the invoice than should be, as the cash discount is not taken into account. This happens regardless of whether the invoice is posted as a gross or as a net amount. Upon payment by Accounting, the tax amount is adjusted automatically, i.e. the tax amount for the cash discount is credited to the input tax account.

In our example, the input tax account is debited with $15 when the invoice is posted. However, only $95 (100 - 5%) is to be taxed. Therefore, the tax to be paid is 15% of $95 = $14.25 The difference, $0.75, is credited to the input tax account when the invoice is paid.