It is possible to enter as many Discounts as agreed with your business partners, by filling in below information:
- the Discount to be applied while creating sales / purchase transactions for that business partner can be selected from the list (if any) or created by navigating to the Discount window.
- Customer: this checkbox must be selected if the discount is going to be applied to a Business Partner set as "Customer"
- Vendor: this checkbox must be selected if the discount is going to be applied to a Business Partner set as "Vendor"
- Apply in Order: this check box must be selected in case the discount can be applied in sales or purchase orders as applicable.
- Cascade calculation of the discount. For instance, if first discount is 10% and second one is 5%, a cascade calculation of the total discount won’t be 15% but 14.5%
A discount not applied in Cascade means that it affects to the full quantity of the Document Line. A Discount applied in Cascade means that affects the quantity of the Document Line that remains after applying all the discounts that come before it.
An example to explain the difference between a Cascade and not Cascade Discount is the following one:
Three Discounts, each one of 10%, the first two ones are defined as not Cascade and the third one as Cascade. Over an Invoice Line of 1.000 USD
- The first discount will create a line of -100 USD (10% of 1.000 USD)
- The second discount will also create a line of -100 USD (10% of 1.000 USD)
- The third one, however, will create a discount based on applying the previous discounts on cascade, so:
- 1.000 USD - 10% = 900 USD (applying the 1st discount on Cascade)
- 900 USD - 10% = 810 USD (applying the 2nd discount on Cascade)
- 10% of 810 USD = 81 USD. So the third discount will be -81 USD.
In total -100 -100 -81 = -281 USD for all three discounts (a total discount of 28.1%)