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VBurgs
Level 2

Recording an "Advance Deposit" paid to a consultant prior to starting a project. (QBO)

Hello,

 

I have just started a project with a consultant and they require a $2,000 initial advance deposit before starting any work.  As we bill hours, the $2,000 deposit is not consumed.  It will remain until the project work is completed.


How should this be recorded?

Solved
Best answer April 29, 2020

Best Answers
Rustler
Level 15

Recording an "Advance Deposit" paid to a consultant prior to starting a project. (QBO)

create a current asset account named for the consultant and use that account as the expense (reason) for the check.

View solution in original post

2 Comments
Rustler
Level 15

Recording an "Advance Deposit" paid to a consultant prior to starting a project. (QBO)

create a current asset account named for the consultant and use that account as the expense (reason) for the check.

View solution in original post

VBurgs
Level 2

Recording an "Advance Deposit" paid to a consultant prior to starting a project. (QBO)


@Rustler wrote:

create a current asset account named for the consultant and use that account as the expense (reason) for the check.


Great.  Thank you!  Do the following details when setting up the account matter?

 

Account Type:  Other Current Assets

Account Details:  Does this matter?  Should I use "Prepaid Expenses?

When do you want to start tracking your finances from this account in QuickBooks?:  Beginning of The Year; Beginning of the Month, or Today?

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