Debit and Credit Adjustments: To Process a Debit Adjustment

The following activity will walk you through the process of creating and releasing a debit adjustment and applying it to a bill.

Video Tutorial

This video shows you the common process but may contain less detail than the activity has. If you want to repeat the activity on your own or you are preparing to take the certification exam, we recommend that you follow the instructions in the steps of the activity.

FEEDBACK

Story

Suppose that on February 11, 2024, SweetLife Fruits & Jams received a credit memo from Spectra Stationery Office, which gave them a $5 discount for the bill of $100.

Acting as a SweetLife accountant, you will need to process the vendor's credit memo as a debit adjustment that reduces the outstanding balance of the bill.

Process Overview

In this activity, you will create a debit adjustment on the Bills and Adjustments (AP301000) form. You will then release the debit adjustment and apply it to the needed bill on the Checks and Payments (AP302000) form.

System Preparation

To prepare the system, do the following:

1. Launch the MYOB Acumatica website, and sign in to a company with the U100 dataset preloaded. To sign in as an accountant, use the following credentials:
   • Username: johnson
   • Password: 123
2. In the info area, in the upper-right corner of the top pane of the MYOB Acumatica screen, click the Business Date menu button and select 2/11/2024. For simplicity, in this activity, you will create and process all documents in the system on this business date.
3. On the Company and Branch Selection menu, also on the top pane of the MYOB Acumatica screen, make sure that the SweetLife Head Office and Wholesale Center branch is selected. If it is not selected, click the Company and Branch Selection menu to view the list of branches that you have access to, and then click SweetLife Head Office and Wholesale Center.

Step 1: Creating a Debit Adjustment

To create a debit adjustment, do the following:

1. Open the Bills and Adjustments (AP301000) form.
2. Click Add New Record on the form toolbar, and specify the following settings in the Summary area:
   • Type: Debit Adj.
   • Vendor: STATOFFICE
   • Date: 2/11/2024
   • Description: Discount from vendor
3. On the Details tab, click Add Row and specify the following settings for the added row:
   • Branch: HEADOFFICE (inserted by default)
   • Transaction Descr.: Discount from vendor
   • Ext. Cost: 5.00
4. On the form toolbar, click Save.

Step 2: Releasing the Debit Adjustment

To release the debit adjustment, do the following:

1. While you are still on the Bills and Adjustments (AP301000) form, click Remove Hold on the form toolbar.

   This gives the debit adjustment the Balanced status. You can release only documents that have this status.

2. On the form toolbar, click Release.

   This gives the debit adjustment the Open status.

3. On the Financial tab, click the batch number to review the batch that the system has generated. Notice that the debit journal entry reduces the balance of the 20000 (Accounts Payable) account by $5.

Step 3: Applying the Debit Adjustment to the Bill

To apply the debit adjustment to the bill, do the following:

1. While you are still on the Bills and Adjustments (AP301000) form, on the form toolbar, click Apply.

   The system navigates to the Checks and Payments (AP302000) form.

2. On the Checks and Payments form, in the Application Date box, make sure 2/11/2024 is selected.
3. On the table toolbar of the Documents to Apply tab, click Add Row and in the Reference Nbr. column, select the $100 bill.

   By default, the system applies the full amount of the debit adjustment ($5) to the bill. After you apply the debit adjustment, $95 ($100 – $5) remains on the balance of the bill, which is displayed in the Balance column. The debit adjustment applied to the bill is shown in the following screenshot.

   
   
   

4. On the form toolbar, click Release to release the application.

   The debit adjustment gets the Closed status because the full balance of the debit adjustment has been applied.