Prepaid Payment Process

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Ha Lam

• July 12, 2023 15:30

Hello, 

My company is in construction industry. It is very common for us to receive a down payment before we start a job. How can we record this prepaid payment correctly in AS? For example: customer prepaid on 6/30/2023, but the invoice date is 7/10/2023 (we issue the invoice when the job complete). The cash receipt interface doesn't let us enter any apply date before 7/10/2023.

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  Rebecca Ralls

  • July 16, 2023 00:22

  You enter the cash receipt with a date of 6/30, and it should hit a prepaid GL Account. i t will be recorded as a credit to prepaid in the june accounting period.

  When you create the invoice on 7/10 you can apply the cash receipt to it, but the apply date will be 7/10. it will record a debit to the prepaid gl account in the july accounting period.  you cannot apply a payment to an invoice before the invoice exists. 

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