Set Up

Before you can use the Accounts Payable system or enter invoices in the Accounts Payable Database you must set up certain general ledger accounts using the BasicBooks General Ledger (BBGL). Follow these steps to create the required accounts.

1. Open the BasicBooks General Ledger program and sign in under your company code.
2. From the General Ledger main menu select: Ledger Accounts -> Create New Account.
   The first account you must create is an account in which you will record the liability for new invoices you receive from vendors. Supply whatever account name and number you want to use which is consistent with your account numbering scheme. (Example: ``Account Payable - Trade'', ``Taxes Payable'', etc.). For the Account Type select either, ``Account Payable'', ``Long Term Liability'', ``Debt Payable'' or, ``Liability - Other''. You must create at least one such liability account but may create as many as you need to conform to your bookkeeping needs.
3. While in Create New Account create a second account in which you will record any discounts you take when paying invoices (Example: ``Discount for Prompt Payment''). For the Account Type select, ``Earned Discount''. Earned discounts are a form of income and will appear on the Income statement as an income item. When you record new invoices in the Accounts Payable program you may enter the terms of any discount the vendor offers for prompt payment. When you pay the invoice you will have the option of deducting this discount from the amount paid to the vendor. (You will also have the option to take the discount even if the time allowed for the discount has expired - i.e., not a prompt payment.) You must create at least one Earned Discount type account but may create as many as you need to conform to your bookkeeping needs.

When you have created these accounts you are ready to start using Accounts Payable.