What is terms of payment key in SAP FI - Financial Accounting?

SAP Term: terms of payment key

• Component: FI

• Component Name: Financial Accounting

• Description: Four digit, freely definable key used to define the terms of payment. The following specifications are possible using the terms of payment key: Day limit Rules for determining the baseline date for payment Cash discount percentages and terms Lock reason and payment method Explanatory text for terms of payment Indicator for installment payment When the user enters a document, he can use the terms of payment key to call up the relevant terms of payment or assign a customer or vendor via the master record.

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• Key Concepts: 
  A terms of payment key is a code used in SAP Financial Accounting (FI) to define the payment terms for a customer or vendor. It is used to determine the due date of an invoice and the discount percentage that can be applied. The terms of payment key is assigned to a customer or vendor master record and is used to calculate the due date of an invoice. 
  
  How to use it: 
  The terms of payment key is used to determine the due date of an invoice and the discount percentage that can be applied. The terms of payment key is assigned to a customer or vendor master record and is used to calculate the due date of an invoice. The due date is calculated based on the payment terms defined in the terms of payment key. 
  
  Tips & Tricks: 
  When setting up a new customer or vendor, make sure to assign the correct terms of payment key so that invoices are calculated correctly. It is also important to review the terms of payment key regularly to ensure that it is up-to-date with current payment terms. 
  
  Related Information: 
  The terms of payment key can be found in the customer or vendor master record in SAP FI. It can also be found in the sales document header when creating an invoice. For more information on setting up and using terms of payment keys, please refer to SAP Help documentation.