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Rita_89
Level 2

Properly booking customer deposit and applying to the invoice

Hello,

 

Could you please help me with the below case? I am not an accounting professional but currently u a the one who is performing all accounting tasks. I will appreciate any help with the below. Could you please advise if the below has been done correctly. Am I missing anything?

 

08/15/2019: Customer deposit received (this is an advanced payment) for the services out company is obligated to perform.

 

08/15/2019:

The deposit has been recorded as a JE the following way:

Cash account has been debited and Customer Deposits (liability account) has been credits. JE date is 08/15/2019.

 

08/15/2019: The check has been deposited into the bank account. Cleared the same day.

 

09/17/2019: The job has been finalized.

 

09/17/2019: The invoice has been created on 09/17/2019 with the invoice date 09/17/2019.

 

09/17/2019:

The following JE has been booked dated 09/17/2019:

Cash has been credited and Customer Deposits Account has been debited.

 

09/17/2019: The invoice has been marked as paid with the payment date 09/17/2019.

 

Also, I would like to mention that September has been closed.

 

Could you please advise if there is something else that should be done or if there were mistakes made with the handling this situation?

 

Thank you!

4 Comments
AlexV
QuickBooks Team

Properly booking customer deposit and applying to the invoice

Thank you so much for the detailed post, Rita_89.

 

This is what we called retainer. It's an advance payments from your customers that we can apply on the future invoices. The same as what you've done, we record it on a liability account. This will only be treated as income after we apply it on the invoice. 

 

You can check this article for the detailed steps to record it: Manage upfront deposits or retainers.

 

I'd recommend reaching out to your accountant since you used a journal entry. They'll be able to verify if the steps you've done are accurate.

 

Post again if you have more questions. I'm here to help.

Rita_89
Level 2

Properly booking customer deposit and applying to the invoice

Thank you. I appreciate your input but I would like to receive the answer to my question not the general information you have provided but a little bit more specific but thanks anyway. 

Fiat Lux - ASIA
Level 15

Properly booking customer deposit and applying to the invoice

@Rita_89 

Consider this bookeeping service for temporary solution if you don't have any accountant yet.

https://botkeeper.grsm.io/quickbooks

 

Hope it helps.

Rita_89
Level 2

Properly booking customer deposit and applying to the invoice

I does not but thanks for your input. 

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