|
Open item
Take an example of misc. purchases.
When you purchase from vendor you pass the following entry.
Dr. Material / Expenses A/c.
Cr. Vendor account (if it is credit purchase)
Now the vendor account is showing credit balance till you make payment to the vendor. This in SAP they call is open item.
While making payment
Dr. Vendor account
Cr. Cash / Bank account
If once you make the payment to vendor, while making the payment to the vendor, you need to link the payment with lying open item of above purchase. System automatically changes the status of above open item (red colour ball) to cleared item (green colour ball) in the vendor account.
|