Credit Limit is the monetary limit up to which the buyer can purchase from a seller on credit. This limit is agreed upon mutually by the seller and the buyer. Credit limits can be set for ledgers created under the groups Sundry Debtors and Sundry Creditors .
By setting credit limits for your buyer or customer, you will be able to effectively manage your receivables. The credit limits allowed by your supplier in the respective ledger, you will be able to effectively manage your payables. During sales, purchase, and order transactions, the credit limit and current outstanding balance of the ledger will be displayed, allowing you to make informed decisions.
On this page
Set credit limit for single ledger
Set credit limit for multiple ledgers in one-go
Check on exceeding credit limit
You can set credit limits for ledgers accounts grouped under Sundry Debtors and Sundry Creditors at the time of ledger creation or from the alteration screen or also at the time of invoicing.
Go to F11 Features > Accounting Features > e nable the option Maintain budgets and controls .
1. Go to Gateway of Tally > Accounts Info. > Ledgers > Create or Alter
2. Select the required party ledger from the list of ledgers to set credit terms .
3. Set the required credit limit.
4. Enable the option Override Credit limit using post-dated transactions , if required.
1. Go to Gateway of Tally > Accounts Info. > Ledgers > Credit Limits .
2. Select the required group of ledgers from the List of Groups to set credit terms.
The Multi Ledger Limit Alteration screen appears as shown below. The list of ledger accounts under the selected group is displayed.
3. Set Credit Limit , Credit Period , and Check For Credit Dates During Voucher Entry in the Multi Ledger Limit Alteration screen .
Set this option to Yes, to get a warning message when the party ledger selected in a transaction has exceeded the credit period, and outstanding bills are not cleared.
Credit period can be either specified in number of days or the due date and are calculated from the voucher date or invoice date or the effective date, as applicable.
If only voucher date exists, it is considered as the effective date for calculation for Credit Days. If effective date is specified in the voucher, it is considered for calculation of due date.
Specify the amount of credit limit against the ledger account in this field. You can set the amount limits in foreign currency if required, for ledgers involving forex transactions.
To view this report for a different group
● Press Ctrl+F4 .
● Change the group in the Select Group screen.
During voucher entry, if the credit limit is exceeded, at the time of accepting the voucher, an error message is displayed.
The error message shows the credit limit defined for the party and the amount exceeded as shown below:
You can however,
● Enter a lower value (within the prescribed credit limit) to complete the entry, or
● Enable the option Override credit limit using post-dated transactions? in the party ledger.
This feature helps in restricting invoicing for the customers or parties exceeding the prescribed credit limits and thereby facilitating better and effective control of the outstandings.
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