You can indicate if the amounts entered in journals include sales tax or do not include sales tax. You can specify this information in three different forms:
form – Specify the default setting of lowest priority regarding the inclusion of sales tax in journal amounts. This is the setting that will apply to amounts on journals if no other information is supplied through a default setting of higher priority or through a manual setting in a line.
form – Specify a default setting that overrides the default setting on the form. Lines in journals that are patterned on a specific journal template automatically receive the journal template default setting regarding the inclusion of sales tax in journal amounts, unless you have entered a setting on the journal itself.
Individual journal forms – Specify a default setting on an individual journal to override the default settings of the and forms.
The highest priority setting is entered automatically on journal templates, journals, and journal lines as they are created, but you can select or clear the field at any time.
If you select the field, you must enter gross amounts in journals. Sales taxes are calculated on the basis of the gross amount and posted to the sales tax account. The net amount is posted to the ledger account entered in the journal.
If you do not select the field, you must enter net amounts in journals. The net amount is posted to the ledger account entered in the journal. The sales taxes are calculated on the basis of the net amount and are posted automatically.
Suppose that the sales tax is 10% and the box is selected.
The total invoice amount is EUR 110.00, which you enter in the appropriate or field in a journal. This amount includes the sales tax.
Microsoft Dynamics AX uses this information to calculate the net amount and sales tax amount. In this example, the net amount is EUR 100.00 (110.00/1.10), and the sales tax amount is EUR 10.