This section will explore the transactions of the accounts payable module; transactions are divided into two main categories, invoicing and payment:
- Invoicing: This is divided into purchase-order-related invoices and non-purchase-order-related invoices:
- The purchase-order-related invoices: These invoices represent the invoices that are normally attached to a purchase order(s). Invoices related to a purchase order can be the final invoice of the purchase order, which is received after delivering the goods, or the prepayment invoice, which is recorded before delivering the goods. The attached prepayment invoice to a particular purchase order is a new functionality released prior to Microsoft Dynamics 365 for Finance and Operations.
- The non-purchase-order-related invoices: These invoices represent the vendor liabilities for services rendered to the company; there are two ways of recording service invoices. The first is non-inventory invoices, which are related to non-stockable items and are commonly used by the company departments to record their expenses. The other type is the invoice journal for services, which is posted directly to the expense account; it is commonly used by accountants.
- Payment: The second category is the vendor payment. There are two types. The first is a prepayment transaction, which is considered as vendor advances. This can be assigned to a particular purchase order, or need not be assigned to a purchase order. The second type is the vendor payment, which is settled against the vendor invoice.
The categories are summed up in the following diagram:
