[Question] "Reversing" a discount taken

[michellepace]

Hi there,

Just a quick question on how to fix a discount I should have never taken.

1. I owed my supplier R200. I paid him R198.
2. I imported my bank transactions, and I allocated R2 discount.
3. My supplier's detailed ledger then showed zero. And I was happy.
4. Then a month passed by and my supplier told me that I was never granted permission to take an early settlement discount. And he was right.

Question:
How do I now "adjust" my suppliers account such that it shows that I still owe him R2? (and all the correct accounts are adjusted).

[Neville Bailey]

This is the way I would do it.

Open the Supplier journal and create an entry for the Supplier account, and enter the discount amount as a credit amount. Use the Discount Received account in the Contra column.

[Kevin Smith]

I prefer to fix it in the original sub-ledger where the entry happened. Open your cashbook, process a supplier payment with the same reference and date. Leave the bank amount as zero and put -2.00 in the discount column.

[Neville Bailey]

I prefer to fix it in the original sub-ledger where the entry happened. Open your cashbook, process a supplier payment with the same reference and date. Leave the bank amount as zero and put -2.00 in the discount column.

In fact, this was my preferred method as well, before I tested it, and I found out that I could not insert a minus sign in front of an amount in the discount column. Have you tried it, Kevin?

[Kevin Smith]

Hi Neville

Yes - tested and working my side.