Partial Vendor Bills against PO's

I can share some information on how to handle this in QuickBooks Desktop, ivanjay205.

In QuickBooks Desktop, you have the flexibility to adjust the quantity of the item on the Purchase Order when creating a Bill. 

Instead of using a default quantity of 1, consider adding multiple quantities to the purchase order (PO) to accurately reflect your anticipated needs. Later, you can easily adjust the quantity on the bill to match the actual amount received.

Check out the Accounts Payable workflow to learn how you can track the money you owe your vendors.

Additionally, here are resources you can refer for future references:

• Set up and use Advanced Pricing.
• Adjust your inventory quantity or value in QuickBooks Desktop

You can always get back to us if you need more help. The Community is ready to assist.

The problem we have is our PO's sync over from our ERP system.  We cannot modify them in Quick Books or our ERP system will override that and sync the data back over since it looks for matches.  I need to partial against that quantity of 1.

Thanks for getting back into this thread, @ivanjay205. I'll share additional insights about the process of tracking your vendor transactions.

In QuickBooks Desktop (QBDT), there's no integrated way to split a purchase order (PO) into multiple bills. The only option is to edit the PO first so you can adjust it when converting it to bills. However, since you're using another program to generate your PO's, you're unable to modify your bills.

That said, I recommend reaching out to your ERP system to check if they'll be able to adjust the POs first before syncing them into the QBDT program. This way, you'll be able to accurately generate bills for what should be partially deposited.

Feel free to visit this article to view how Accounts Payable tracks the money you owe from your vendors: Accounts Payable workflows in QuickBooks Desktop.

Moreover, you can check out this article to learn more about how you can settle your payables in the QBDT program: Pay bills in QuickBooks Desktop. It also contains troubleshooting steps if you can't locate the bills you want to mark as paid in the Don’t see the bills you want to pay? section.

If you have any follow-up questions about managing your vendor transactions in QBDT, please let me know by commenting below. I'm always willing to help. Stay safe!

@ivanjay205 

Is there a reason you're creating a bill from the PO when you're just making a deposit?  From an accounting perspective, recording a deposit is not the same as getting billed for items on a PO.  When you convert the PO to a bill, it's as though you have received the finished product from the sub, no?  Why not record the deposit as a prepaid asset (negative A/P in QB) that can be used to pay a future bill once work is finished/in progress?  In QB, you can enter a payment for the deposit and assign it to A/P.  That will allow you to apply the deposit to future bills and not mess up your PO.  Just my $.02.    

This is an interesting idea.....  Never thought of it.  The reason I am entering a bill is I am receiving a physical bill from my vendor.  This way I can track the date, discount if we take one for an early pay (we can do that on some deposits too), and find it by looking up a bill invoice # etc.  Since it is always an actual bill I just figured best to enter it as a bill.  Thoughts on that?

@ivanjay205 

That's understandable.  You can still enter a bill in QB when receiving a physical bill, it's just that you should record that bill as a prepaid asset.  You can also record it as a reduction in A/P (both debits in double-entry accounting) that can be applied to future bills and not as an expense.  The main reason you shouldn't convert the PO to a bill is that you're incurring the expense (taking a tax deduction) when you shouldn't.  That's improper from both a tax accounting and GAAP standpoint.  In your example, if you converted a PO to a bill on Dec. 15, 2023, but didn't receive the final bill from the sub until January 2024, you will be taking a $50,000 tax deduction in 2023 (assuming the bill has all expense items on it) that you shouldn't be taking until 2024, thereby incorrectly reducing your taxable income in 2023.  

You have a couple of options to record the deposits:

https://quickbooks.intuit.com/learn-support/en-us/help-article/vendor-credits/record-vendor-prepayme... 

Thanks, How would you enter the bill as a prepaid asset in quickbooks?

From the GAAP standpoint.  We do job reporting / WIP reportingand entries so from a tax standpoint it will correct everything anyway to be consistent with work done based on percentage of completion.  That being said I do think your theory might make it easier for deposits.  

Hello there, @ivanjay205.

I'm here to help you record a prepaid expenses in QuickBooks Desktop.

First, you can create an expense account. Follow the steps below.

1. Create an account to track the prepaid expense. Generally, this is an Other Current Asset account.
   1. From the Company menu, select Chart of Accounts.
   2. In the Chart of Accounts window, right-click anywhere, then select New.
   3. From the Choose Account Type window, click the  drop-down for Other Account Types, then select Other Current Asset.
   4. Click Continue.
   5. Enter the Account Name (Example: Prepaid Expenses) and other details, then select Save & Close.
2. Enter payment to vendor using the account created in Step 1.
3. Create a memorized journal entry to allocate one month or quarter of the expense.
4. The entries will record according to the frequency you selected, reducing the Prepaid Expenses account each period. The balance in the Prepaid Expenses account should be zero at the end of the coverage period.
5. If the user has multiple prepaid expenses to track, it is suggested that they create sub-accounts of the Prepaid Expenses account in order to track each separately.

You can also read this article for the detailed steps: Record and allocate Prepaid Expenses.

I would also recommend consulting an accountant to avoid messing your books in choosing the way to record your expenses. If you don't have one, you can click this link: Find an accountant.

For future reference, you can also refer to this article about reconciling an account in QuickBooks Desktop: Reconcile an account in QuickBooks Desktop.

Let me know if you have questions about recording expenses in QuickBooks Desktop. I'm always here to help. Have a great day.