prepayment invoice

With a prepayment invoice, you can make advance invoice payments to a vendor before the purchase order is fulfilled. For example, a vendor might require a prepayment for specific goods or services. After the prepayment is paid, your legal entity can later apply the prepayment to one or more vendor invoices to offset the amount that was already paid.

What do you want to do?

1.     Learn more about...

2.     Define a prepayment account

3.     Create a purchase order that has a prepayment

4.     Create a prepayment

5.     Post and settle payments against a prepayment

6.     Post the vendor invoice

7.     Apply a prepayment against a vendor invoice

8.     Reverse the application of a prepayment

Learn more about...

Click these links to find more information about the concepts that are discussed in this topic.

About prepayments and prepayment journal vouchers.

• Define a prepayment account

Click Inventory management > Setup > Posting > Posting. Click the Purchase order tab.

Select the Prepayment option in the Select pane.

Click Add to add a posting type, and then select values in the fields. For prepayments, select Category in the Item code field, and then select values in the Category relation, Account code, and Main account fields. For more information, see Item posting (form).

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• Create a purchase order that has a prepayment

Click Accounts payable > Common > Purchase orders > All purchase orders.

On the Action Pane, click Purchase order to create a purchase order.

Select a vendor account in the Create purchase order form. Enter any additional header information, and then click OK.

In the Purchase order lines grid of the Purchase order form, enter other information for the purchase order, including the item number, quantity, and unit price. For more information, see Create a purchase order.

On the Action Pane, click the Purchase tab, and then click Prepayment.

Enter information for the prepayment, including a description, the value of the prepayment, whether the prepayment is a fixed amount or a percentage, and a prepayment category ID. For more information, see Prepayment (form).

Click Save.

In the Purchase order form, on the Action Pane, click the Purchase tab, and then click Confirm to confirm the purchase order.

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• Create a prepayment

Click Accounts payable > Common > Purchase orders > All purchase orders.

Double-click a confirmed purchase order that has a prepayment definition.

On the Action Pane, click the Invoice tab. In the Generate group, click Prepayment invoice. The Vendor invoice form opens.

Enter information for the prepayment invoice, including the invoice number. You cannot change quantities for a prepayment invoice.

On the Action Pane, click Post to post the prepayment invoice, and then click Post in the form that is displayed. For more information, see Key tasks: Vendor invoices.

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• Post and settle payments against a prepayment

Follow these steps to post and a settle a single payment against a prepayment.

Click Accounts payable > Journals > Payments > Payment journal.

Click New to create a payment journal.

Enter information for the payment journal and then click Lines.

In the Journal voucher form, select the account, offset account, and other journal voucher details. For more information, see Journal voucher - Vendor payment journal (form).

Click Functions, and then click Settlement. The Settle open transactions form opens.

Select the Mark check box to mark the prepayment transaction for settlement, and then close the form.    In the Journal voucher form, click Post, and then click Post.

• Post the vendor invoice

Follow these steps to create and post a vendor invoice for the purchase order.

Click Accounts payable > Common > Purchase orders > All purchase orders.

Double-click a purchase order that includes a prepayment. The Purchase order form opens.

On the Action Pane, click the Invoice tab. In the Generate group, click Invoice. The Vendor invoice form opens.

Enter information for the invoice, including the invoice number.

On the Action Pane, click Post to post the prepayment invoice, and then click Post in the form that is displayed. For more information, see Key tasks: Vendor invoices.

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• Apply a prepayment against a vendor invoice

Follow these steps to apply a prepayment against a vendor invoice.

Click Accounts payable > Common > Vendors > All vendors.

Double-click the vendor for the vendor invoice that you created. The Vendors form opens.

On the Action Pane, click the Invoice tab, and then click Apply prepayment.

In the Select the invoice to apply the prepayments to grid, select the vendor invoices to apply the prepayments to. In the Select prepayments to apply grid, select the prepayment invoices to apply.

Click Apply prepayments.

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• Reverse the application of a prepayment

Follow these steps to reverse the application of a prepayment that was made against a vendor invoice.

Click Accounts payable > Common > Vendors > All vendors.

Select the vendor for the vendor invoice that you created.

On the Action Pane, click Edit.

On the Action Pane, click the Invoice tab, and then click Reverse prepayment application.

In the Select the invoice to reverse the prepayments from grid, select the vendor invoices to reverse the prepayments from. In the Select prepayments to reverse grid, select the prepayments to reverse.

Click Reverse prepayment application.