Does a supplier's Late Charge Option "Not Abblicable" override Business Unit Defaults?

We currently have "Enable Late Charge" checked in our Payables Installation Options page and have the Late Charge Option set to "Compute Charges" with the appropriate charge code set in our Payables Definition page.  But on the supplier's Location>Additional Payables Options> Late Charges group we have Late Charges = "Default from Higher Level" and Late Charge Option = "Not Applicable".

Will late charges be automatically calculated, if payment is late, based on how we have late charges setup for this business unit/vendor?  Any advice or guidance would be appreciated. Thanks in advance to all who respond.