Apply Document is designed to apply a credit against a debit, or vice versa.  For example, to apply a pre-payment against an invoice received after the fact.  Apply your payments against the invoice.  The customer balance will reflect it. 

Yes, I agree.

But why does Sage 300 allow allocating payment to payment or credit to credit?
Why will Sag 300 not disable it?

There are different reasons for doing a receipt type entry including allocating to more than one document e.g. one invoice and one receipt so we don't want to block allocations to receipts.

Could you provide a few examples of when users need to allocate a payment to another payment, or a credit memo to another credit memo?
I mean, to apply a payment against another payment.
From a business perspective, in what scenarios would they need this, and why do you allow such transactions?
I've only seen this in Sage 300, nowhere else.

This only applies to Receipt entry. Imagine you are applying a receipt B $800 to 2 documents, Invoice A $1000 and Receipt A $200. A net of $800 received. Try this in sample data and see what happens. Let me know what transpires.

Each receipt gets applied to Invoice A.  The invoice is then paid in full.  End of story.

Thank you Jim, only possible if you can apply to Receipts.

Sorry, I do not understand.  The normal process is:  Invoice A gets posted.  Receipt A gets applied (during entry) to Invoice A.  Receipt A is then fully applied.  Receipt B gets applied (during entry) to Invoice A.  Receipt B is then fully applied, and Invoice A is then fully paid.  There is nothing else to be done. 

Here's the case:

I created an invoice for $1130 and posted it.
Then I created and posted a receipt for $200.

After that, I created a new receipt for $1400.

From that $1400:

• I allocated $200 to the previously posted receipt (i.e., I allocated a payment to a payment),

• and I allocated $1130 to the invoice.

Then I posted the payment.

As a result:

• The invoice was fully paid.

• The payment I had previously posted for $200 was also marked as fully paid (ID: PY00000000000000000319).

And here is the balance for the payment I just posted:
PY00000000000000000320

Total: -1400
Applied: 930
Current Balance: -470



But I still don't understand the point of allowing a payment to be allocated to another payment.
After all, the client can already apply the payment directly to the invoice without needing to allocate it to another payment.

What you're able to do is incorrect. You should not be able to apply payments to a payment. This is a bug, imo.

Normally you'd bring up the first receipt and apply it to the invoice. Then generate another entry in the same batch. Select the second payment and apply it to the same invoice.

Yes, I think this is a bug in Sage 300 too.

Agreed.

Agreed.