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Join nowHello, all help gratefully received. I have seen much discussion here about prepayments and deposits, and I completely understand creating a liability account for them until the sale has been completed, but can someone help with a step-by-step for all this, which is an increasingly common transaction within our Community? Outside QB online, we issue a proforma invoice to our customer, which is not a commercial invoice, but internationally viewed as an "understanding" between us. The customer pays us the amount on the proforma, then in due course, we provide the goods/services and issue the final PAID commercial invoice. What is the best way to do this within QB online, so that the prepayment is properly attributed to the customer, but treated as a liability until the sale is completed and the invoice created? (Are Journal Entries needed, can we record the prepayment as a Sales Receipt, and then create an invoice for it?)
Hi nick25,
Thank you for taking the time to post today.
Creating a proforma invoice is currently not a future in QBO. The invoicing option we have will affect your books, unlike a proforma invoice. However, you can still use it since you have an agreement with your client.
I'll share the article with steps for recording prepayments and eventually use them to pay invoices in the future. Please check this out: Record a retainer or deposit.
If you have other questions in mind, feel free to go back to this thread.
Thank you JessT, this helps move me a little closer to the solution. (I apologize - I confused things by mentioning proforma invoices, but I explained that they are issued outside QuickBooks). Referring me to this link Record a retainer or deposit helped me to figure everything out, so thank you very much for your great help today!
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