Trade Agreements in AX 2012 

Trade Agreement : Trade agreements are fixed price or discount agreements that are set up for one or more customers or vendors for the sale or purchase of individual or multiple products.

        Trade agreements can apply to the following:

• A specific customer, a vendor or a product.
• Groups of customers, groups of vendors or groups of items. 
• All customers, all vendors or all items.

     Trade Agreement in AX 2012 is of four types which are applicable for both purchase and sales types. They are :-

                

1.     Price

2.     Line discount

3.     Multi line discount

4.     Total discount

NOTE: Before studying in details, we need some set ups. Firstly we have to activate the Trade agreements. To activate it go to

            Procurement & Sourcing > Set up > Price/discount > Activate price/discount > and activate the combinations. (for Purchase orders) 

     Sales & Marketing > Set up > Price/discount > Activate price/discount > and activate the combinations. (for Sales orders).

     Now, go to Sales & Marketing > Set up > Price/discount > Customer Price/discount groups > and create desired group. (This is for Customer price/discount groups).

     Procurement & Sourcing > Set Up > Price/discount > Vendor price/discount groups > and create the desired group. (This is for Vendor Price/discount groups).

     Inventory & Warehouse Management > Set up > Price/discount > Item discount groups > and create the desired group. (This is for Item discount groups).

      Thirdly we have to set up Trade Agreement journal names. For this go to

Procurement & Sourcing > Set Up > Price/discount > Trade Agreement Journal names > and create a name. (This is for Purchase orders)

     Sales & Marketing > Set Up > Price/discount > Trade Agreement Journal names > and create a name. (This is for Sales orders)

     Now we will see all the types of Trade Agreements in details.

     Now a journal lines, price/discount agreement form will open. In the Relation field select the Price (Sales). Select account code as Table. In the Account selection select a customer. Select an item code as Table and select an item on which you want your agreement to be.

     After you set up all the details click on Validate and Post. Now we will see the effect of this agreement that we have set up. For this we will raise a Sales order with the specific item and specific customer account.

c   For this go to Sales & Marketing > Common > Sales Order > All Sales order > and create a new one.

     Now go to the header view of the sales order and assign Price group under the Price & discount fast tab.

    When you create a new sales order for the specific item and specific customer as you posted in the journal for the Trade Agreement, the system automatically takes the unit price and the sales charges and calculates the net amount automatically.

            For this go to Sales & Marketing > Common > Sales Order > All Sales order > and create a new one.

     Now go to the header view of the sales order and assign Price group under the Price & discount fast tab.

     when you create a new sales order for the specific item and specific customer as you posted in the journal for the Trade Agreement, the system automatically takes the  unit price and the sales charges and calculates the net amount automatically.

Line Discount:

 It is the discount applied on the individual sales/purchase order lines. Here we specify discounts as percentage or as amount. For example > suppose I Sell Mirinda, Sprite & Mountain Dew. I want to give my customer a rebate of 2USD from the original price & then 10% discount & additional 2% discount. But it is applicable if they buy minimum 3 bottles of one product.

For this create a journal with the same procedure as we have made previously. But in the Relation field select the Lines Discount (Sales) option. We have set up as per the requirement of the example in the system. After the set up click the Post button to post the created journal.

      Now we will see the effect of this agreement that we have set up. For this we will raise  a Sales order with the specific item and specific customer account.

 For this go to Sales & Marketing > Common > Sales Order > All Sales order > and create a new one.

     Now go to the header view of the sales order and assign Line discount group under the Price & discount fast tab.

      Now I am explaining the calculation by the system as per the above set ups. If suppose each bottle of say sprite or mirinda or mountain dew is 50 USD. Then the system will first deduct 2 USD (From Amount in currency) which is equal to 48 USD. Now it will take the 1^st line of the Discount percentage 1. So 10% of 48 USD is 4.80 USD and hence the net amount will be 43.20 USD. Now the system will take the 2^nd line of the Discount Percentage 2. So, 2% of 43.20 USD is 0.864 USD and hence the net amount is 42.336 USD. But this is applicable if the particular customer takes minimum of 3 quantities. So net amount will be 127.1 USD (42.336*3) for 3 quantities.

Multi line Discount: 

It is similar to line discount but with a little difference. It can be applied when one or more Sales order/Purchase order lines that are added together to meet the discount requirement. Let me explain this concept with an example. For example > suppose I Sell Mirinda, Sprite & Mountain Dew. I want to give my customer a discount of 10% if they purchase 3 bottles of the product (It may be 1 bottle of Sprite & 2 bottles of Mirinda or 2 bottles of Mountain Dew & 1 bottle of Sprite or even 3 bottles of Sprite).

For this create a journal with the same procedure as we have made previously. But in the Relation field select the Multi line Discount (Sales) option.

NOTE: Here I gave Group in Item code which means I want to assign discount on multiple items (as per the example). We have set up as per the requirement of the example in the system.

     Now once the journal has been posted, raise a sales order. Here we will raise a SO of 2 bottles of Sprite & 1 bottle of Mirinda.

     Now once a SO is raised, go to the Header view & under the Price & Discount fast tab, under Discount or charges select the Multi line discount group.

      Now, go to Product Information Management > Select that particular item (Mirinda & Sprite as per in our example) > Edit > in the Sell fast tab, under Discount field > Select the Multi line discount.

NOTE: Multi line discount works only if you click the Multi line discount button in the Sell fast tab of the Sales order form.

Total Discount:

 It is used to specify one discount for the whole sales order. Total discount is being used when the organization want to give a discount depending on the amount of the sales order and not on the quantity of items ordered. For example > If any one purchase 500 USD of any product then I will give a discount on it. The discount will be 50 USD and then 10% after that.

     For this create a journal with the same procedure as we have made previously. But in the Relation field select the Total Discount (Sales) option.

NOTE: Here I gave All in Item code which means I want to assign discount on all the items but if total will be 500 USD. We set up in the system as per the requirement in the example.

     Now once the journal has been posted, raise a sales order irrespective of any item (since we gave all in the item code) having a sum total of 500 USD.

 Now once a SO is raised, go to the Header view & under the Price & Discount fast tab, under Discount or charges select the Total discount group.

NOTE: Now make sure that in, Product Information Management under the sell fast tab, Total Discount checkbox is checked for the items you have raised the Sales Order.

NOTE: Total discount works only if you click the Total discount button in the Sell fast tab of the Sales order form.

     Once you have clicked the Total discount button the discount has been applied. It can be seen in the Totals of the Sales order pane.

                                 Reimbursement in AX 2012

Reimbursement is a process where you return the advance payment of the customer that you have.

Go to Account Receivable > Account Receivable Parameters > General > enter minimum reimbursement amount of customer over payments.

Next, add a vendor account to each customer who can be reimbursed. (If a customer does not have a vendor account, a one-time vendor account is automatically created for the customer). Click Accounts receivable Common > Customers > All customers. Select the customer account then click Edit.

Click the Miscellaneous details Fast Tab. In the Vendor account field select the vendor account for the customer.

Now we are ready to create the reimbursement transactions, i have selected a customer who already has a credit balance.

Click Accounts receivable > Periodic >Reimbursement.

Reimbursement form opens, now click on select.

Query form opens, now enter customer account or customer group and click OK.

An info log is shown about reimbursement transaction is created and that amount will be deducted from customer balance.

Go to customer master form and select customer as "Saurabh Jain" and click on Balance to see the remaining balance, balance is Zero.

Cheers!!!

                                  

                   Tiered Charges in Sales Order in AX 2012

Tiered Charges: - These charges are calculated based on Net amount on any Sales Order.

First we need to do setup for charges calculation in Account Receivable parameters.

Go to Account Receivable Parameter and click on Prices. Under Prices section check Find Main Charges and Find Charges for Line. 

Steps:-

        Go to Setup> Charges > click on Auto Charges.

1.      Auto charges form opens, click on new then Select Account code, Customer relation and mode of delivery.

2.      Now click on lines and select category and enter charges value that will apply based on condition given.

3.      Enter From Amount and To Amount.

From amount > Minimum amount where this charge will be applicable.

To amount > Maximum amount limit till where the charge will be applicable.

Note: If you are selecting Account Code as group mention charges group on selected group.

Now create a sales order, after creating the sales order for 999.00 the charges will not be applied automatically.

Note: if total amount is less than the To Amount then it will not calculate automatically.No charges are applied.

Since the system requires calculating and comparing the configured charges against the sales order total, this calculation function is done by using the Tiered Charges function on the sales order header.

For calculating Charges go to Sell tab and click on Tiered Charges.

An Info log will be shown about calculated charges.

Amount will reflect on totals form.

Cheers!!!

 

• DUNS Number: - Data Universal Numbering System Every Company that does the trade in United States has a D-U-N-S number.  It is a nine digit number and this field is only available if the customer record type is organization.. The DUNS number is random, and the digits have no apparent significance.Unlike national employer identification number, a DUNS number may be issued to any business worldwide

• Item reservation
  
  
  ·         Manual – Inventory for orders is reserved manually.
  ·         Automatic – Inventory is reserved when order lines are created, in the order in which the order lines are created. For bills of materials (BOMs), reservations are made for the BOM item number, not for the individual elements of the BOM.
  ·         Explosion – Inventory is reserved when order lines are created, in the order in which the order lines are created. For BOMs, reservations are made for the individual elements of the BOM, not for the BOM item number.
  Posting profiles specify the ledger accounts that are affected when source documents are posted to the general ledger or when journal entries are journalized. Each posting profile is associated with only one offset account. 
• Credit and collections in credit and limits:
  The invoice and delivery on hold function has several below options:-
  
  
  No – No holds have been placed on the customer.Invoice – No invoices can be posted for this customer.All – The customer is on hold for all transaction types, including free text invoices, customer invoices, and payments.Payment – This is invalid option for customer and cannot be selected.Requisition – This is invalid option for customer and cannot be selected.Never – The customer is never put on hold for inactivity.