Book Image

Microsoft Dynamics 365 Enterprise Edition - Financial Management - Third Edition

By : Mohamed Aamer Ala El Din
Book Image

Microsoft Dynamics 365 Enterprise Edition - Financial Management - Third Edition

By: Mohamed Aamer Ala El Din

Overview of this book

Microsoft Dynamics 365 for finance and operations is a rapidly growing application and is widely used in enterprise organizations. Because of its ability to maximize business productivity, it is a fast-growing business application package in the ERP market. We will start by looking into ERP concepts, implementation needs, and interface design, giving you basic knowledge of financial management aspects and explaining key concepts along the way. To begin with, you'll be taken through the general ledger and financial dimension functions. You'll later learn about the sales tax mechanism and multi-currency in Microsoft Dynamics 365. We tackle each topic with focused examples and explanations on topics such as payable/receivable accounts, forecasting, cash and bank management, budgeting planning/control, and fixed assets. Finally, we walk you through intercompany, consolidation, costing basics, and financial reporting. By the end of this book, your finance team will have a much richer understanding of Microsoft Dynamics 365 for finance and operations and its powerful capabilities.
Table of Contents (24 chapters)
Title Page
Copyright and Credits
Dedication
Packt Upsell
Contributors
Preface
Index

Exploring sales tax high-level cycles and entries


In this section, we will explore the sales tax business process, and the generated financial entries in tax payable and tax receivables.

Sales tax business process

Sales tax is a tax paid to the government for the trading of some goods and services. As shown in the following diagram, the sales tax receivable is generated from vendor transactions, whether from a purchase order invoice or service invoice. The sales tax payable is generated from customer transactions, whether from a sales order invoice or a service invoice. Then, the net of the tax receivable and tax payable is settled to be paid to the sales tax authority: 

The generated financial entries in the sales tax cycle are as follows: 

  • Tax receivable—accounts payable: The financial entries generated in the course of posting the vendor invoice transaction are debiting expenses, sales tax, and crediting accounts payable.
  • Tax payable—accounts receivable: The financial entries generated in...