What key financial function does the EDI 820 facilitate?

The EDI 820, also known as the Payment Order/Remittance Advice, is specifically designed to facilitate the handling of billing and payments in electronic transactions. This document allows businesses to manage the payment process efficiently by conveying payment details and remittance information directly between trading partners.

The EDI 820 includes important information such as payment amounts, payment dates, invoice numbers, and other relevant details that ensure the correct allocation of payments to outstanding invoices. Therefore, its primary function is to streamline the process of invoice payment and help organizations maintain accurate accounts receivable records.

In comparison, the other options do not align with the purpose of the EDI 820. Writing checks pertains to physical payment methods, tracking employee hours relates to payroll management, and managing corporate credit refers to credit evaluation and control, which are outside the scope of what the EDI 820 addresses. Thus, the EDI 820’s direct association with billing and payments positions it as the correct answer.