Accounts Payable Certification Practice Test

What happens to invoices and credit memos when submitting payment requests with an option to apply credits up to zero?

1. Only the invoice is paid fully; credit memo has remaining credit.

2. Both the credit memo and invoice can be included in the payment.

3. Only the credit memo is settled fully.

4. Neither the invoice nor the credit memo are submitted.

The correct answer is: Only the invoice is paid fully; credit memo has remaining credit.

When submitting payment requests with the option to apply credits up to zero, only the invoice is paid fully while the credit memo has remaining credit. This means that the payment process prioritizes settling the outstanding invoice amount, ensuring that the total owed is covered. However, if there is a credit memo associated with that invoice, which indicates a reduction in the amount owed or a previous overpayment, the system recognizes that credit but simply does not apply it to the payment request in this scenario. The credit memo remains on record, showing that there is an available credit, but since the payment was requested to be made without using it, the invoice amount is settled fully, leaving the credit memo balance intact for future use. The other options do not accurately reflect the typical process or result of applying credits to payment requests. For instance, including both the credit memo and invoice in a single payment would not take place when the instruction is to settle without reducing the invoice amount with the available credit, while settling the credit memo fully or excluding both from submission does not align with the operation that treats the invoice payment as primary in this context.