Revenue Commitment Reversal from a Return Authorization

Revenue Commitment Reversal from a Return Authorization Example:

1. Create a Sales Order.
-- Transactions > Sales > Enter Sales Order.
-- Enter Customer.
-- Enter Item qty 10 @ 50 = 500.00
-- Enter Revenue Recognition Template
Name = Revenue Recog Template
Type = Standard
Method = Straight-line, by even periods
Term Source = Rev Rec Dates specified on transaction
Recognition Period = 5
Period Offset = 0
Start Offset = 0
Initial Amount = 50.00
-- Start Date = January 18, 20121
-- End Date = January 17, 2013
-- Revenue tab > Rev Rec on Rev Commit. = True
-- Click Save.
 
2. Create Revenue Commitment.
-- Navigate to the sales order.
-- Click on Commit Revenue button.
-- Click Save on Revenue Commitment.
 
GL Impact:
Debit: Unbilled Receivable 500
Credit: Deferred Revenue 500
 
3. Invoice the sales order.
-- Navigate to the sales order.
-- Click Bill.
-- Click Save on the invoice.
 
GL Impact:
Debit: Accounts Receivable 500
Credit: Unbilled Receivable 500
 
Note: The following accounts are outstanding:
 
Debit: Accounts Receivable 500
Credit: Deferred Revenue 500
 
If at this point the customer decides not to proceed.
 
4. Create a Return Authorization.
-- Navigate to the sales order.
-- Click Authorize Return.
-- Click Save.
 
5. Create a Revenue Commitment Reversals either by
a. Clicking on Reverse Revenue button on the return authorization.
b. Transactions > Financial > Generate Revenue Commitment Reversal.
-- Navigate to the New Revenue Commitment Reversal.
-- Click Save.
 
GL Impact:
Debit: Deferred Revenue 500
Credit: Unbilled Receivable 500

6. Create a Credit Memo from the Return Authorization.
-- Navigate to the return authorization.
-- Click Refund.
-- Navigate to the credit memo.
-- Apply the invoice created in Step #3.
-- Click Save.
 
GL Impact:
Debit: Unbilled Receivable 500
Credit: Accounts Receivable 500
 
There are no Accounts outstanding at this point.
 
Note:
1. Set Up > Company > Enable Feature > Sales Order Revenue Forecasting = F.
2. Both the Revenue Commitment and the Revenue Commitment Reversal appears in Transactions > Financial > Create Revenue Recognition. Users have the option to mark the Revenue Recogniation Schedule Is Recognized to remove it from the sublist.