Recording an advance payment

[Customer Service]

Recording an advance payment received from a customer and then entering the invoice when the job or delivery is complete

Follow these instructions for entering an advance payment sale in 21st Century Accounting.

Set up an advance payments liability account.

1. Run General Ledger/Configure/Chart of Accounts.
2. Expand the “Current Liability” category (click the + sign).
3. Double-click <new> or press F9 to add the new account.
4. Add an account for advance payments received.
5. Click the Save Changes button when you finish or press the Alt+V keys to save.

Set up a Cash Receipts Journal to enter advance payments received.

1. Run Bank Accounts\Configure\Cash Receipts Journal.
2. In the left pane, double-click <new> or press F9.
3. Enter a name for the journal; for example, “Advance Payments.”
4. In the Source Code field, select CJCR Cash Register Journal.
5. Optionally, mark Indent credit column (recommended for readability).
6. In the Columns allowed field select Credit only.
7. In the Account field, select the Advance Payment account you set up in Step 1 above.
8. Tab to the Prompt field and type your own prompt if you wish.
9. Click OK and then click the Save Changes button.

Enter a deposit to record the Advance Payment received.

1. Run Bank Accounts\Deposits.
2. Double-click <new> or press F9.
3. In the Batch Options window, enter the ID of the bank account to which the payment is deposited.
4. Enter the Deposit number or let the system generate one.
5. Enter the Deposit date if different from the current date.
6. Click the OK button.
7. In the Deposits window, at Receipt type, select the Cash Receipts Journal (for example, “Advance Payments”) you created in Step 2 above.
8. At Receipt amount, enter the amount of the advance payment.
9. Change the Transaction date if different from the current date.
10. In the credit column enter the amount of the advance.
11. For the Description, you can enter the customer's name or any information you wish to identify the advance payment.
12. Click OK to complete the transaction.
13. Click Save Batch to save the transaction.
14. Click Post Batch to record the transaction.
15. Run Bank Accounts\Print\Cash Receipts Journal and select the journal (for example, “Advance Payments”) to preview or print the journal.

Create a Product List Item for advance payments received.

1. Run Sales\Product List.
2. Double-click <new> or press F9.
3. Type an ID; for example, “AdvPayRec.”
4. Enter a description; for example, “Advance Payment Received.”
5. For the GL account, select the advance payments liability account you set up in Step 1 above.
6. Click OK and then Save Changes.

Process the Sales Invoice when the job is complete.

1. Run Sales\Invoices.
2. Double-click <new> or press F9.
3. Set up the Batch Options for the entry.
4. Complete the top portion of the Sales Invoice as you normally would.
5. On the first line in the Invoice details table, enter the product or service for which the advance payment was made.
6. On the second line, select the Product List item you set up in Step 5 above for advance payments received.
7. In the Amount field, as a negative amount, enter the amount of advance payment (which you have already recorded as a deposit) to apply to this invoice.
8. Click the OK button when the invoice is complete.
9. Click Save Batch and then Post Batch to record the transaction.