TBA Foundation · Lesson 8 of 9 · about 3 hours
After this lesson you can #
- Take a purchase from order to payment.
- Explain why a purchase order is not yet an expense.
- Record a bill, pay it, and handle a return or an overpayment.
- Use AP Aging to see what you owe.
Why it matters #
The buying side keeps your costs, inventory and cash right. Entering bills when they arrive is what makes your reports tell the truth.
Read #
- Bills Overview
- Vendors
- Vendor Returns
- Vendors articles (purchase orders, paying bills, quick payment)
The big picture #
You place a purchase order (a commitment, not yet an expense), receive the goods, enter the vendor’s invoice as a bill, and pay it. Entering the bill on receipt puts the cost and what you owe in the right period; receiving stock adds to your inventory. One bill can cover several purchase orders. Pay several bills at once from the list of bills to pay, or use Quick Payment for something small that needs no bill. If goods go back, record a vendor return from the bill; it becomes a credit. An overpayment stays as a vendor credit. AP Aging shows what you owe and how overdue it is. Vendor tax details support year-end 1099 reporting.
Try it #
- Create a purchase order, receive it, and enter its bill.
- Pay the bill.
- Return an item from a bill and find the credit.
Check yourself #
Can you say why a purchase order is not yet an expense, and what a vendor return turns into? A practice quiz and certification exams are planned for a later release.
