If you require your customers to submit payment before you ship
an order to them, or if your vendor requires you to submit payment
before they ship an order to you, you can use the Prepayment
functionality.
You can set up default prepayment percentages for customers,
vendors, and items.
After you create a sales or purchase order, you can create a
prepayment invoice. You can use the default percentages for each
sales or purchase line, or you can adjust the amount as necessary.
For example, you can specify a total amount for the entire
order.
To Set Up Prepayments
Before you can create and post prepayment invoices, you
must:
Since the prepaid amount belongs to the buyer until they have
received the goods or services, you need to set up G/L accounts to
hold the prepayment amounts until the final invoice is posted.
Sales prepayments must be recorded in a liabilities account until
the items are shipped. Purchase prepayments must be recorded in an
assets account until the items are received.
You must set up a separate G/L account for each VAT
identifier.
You can use the same
number series for prepayment invoices and regular invoices, or you
can use different number series. If you use different series, they
must not overlap - there must not be any numbers that exist in both
series.
For an item, you can set up a default
prepayment percentage for all customers, a specific customer, or a
customer price group. To setup prepayment defaults for an item, on
the item card, click Sales,
Prepayment Percentages.
For a customer or vendor, you can set
up one default prepayment percentage for all items and all types of
sales lines. You enter this on the customer card, in the
Prepayment % field.
Which Prepayment Percentage Has First Priority?
An order may have a prepayment percentage on the sales header,
and a different percentage for the items on the lines.
For each sales line, the program looks
for the prepayment percentage in the following order, and will
apply the first default that it finds:
A prepayment percentage for the item
on the line and the customer that the order is for.
A prepayment percentage for the item
on the line and the customer price group that the customer belongs
to.
A prepayment percentage for the item
on the line for all customers.
The prepayment percentage on the sales
or purchase header.
In other words, the prepayment
percentage on the customer card will only apply if there is no
prepayment percentage set up for the item.
However, if you change the contents of
the Prepayment % field on
the sales or purchase header after you create the lines, the
prepayment percentage on all of the lines will be updated. This
makes it easy to create an order with a fixed prepayment
percentage, regardless of the percentage set up on items.
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Set up G/L Accounts for
Prepayments
General Posting Setup window, you must
fill in the following fields: