Hello @eivc1 ,
There is a way to do this if your client absolutely must have an invoice. Normally, as you alluded to in your post, a client will just give you a lump sum for a deposit, and you would use a Receive Payment to that client's A/R account, and leave it sitting there as an unapplied payment until such time as you invoice the client. The A/R balance will update to the current balance owing.
However, if they must have an invoice, you can do it this way:
- Create a current liability account called Customer Deposits (if you don't have one already).
- Create a new item with type Other Charge. Call it Deposit Received and link it to the account you created in step one (Tax Code would be E for Exempt).
- When you receive a deposit from a customer, create an invoice. Use the item you just created in Step 2, entering something to the effect of Down Payment for goods/services not yet rendered. Do not add any taxes! It is not necessary, as you are not creating a sale yet; you are simply creating a liability that you owe that client the $ value of the deposit in either goods, services or cash.
- Use Receive Payment like you would for any other A/R. The invoice you created in Step 3 will show up in the list to apply the payment against.
- When you are ready to bill your client for the full amount of goods and/or services plus taxes, create your A/R invoice as you normally would. If there is more than one line on the invoice, use a sub-total at the end of the list of items you are charging for.
- On another line of the invoice, enter the Deposit Received item you created in Step 2. Enter a negative qty of 1, and the amount of the deposit. The extended amount will be a negative. The invoice total will be the difference owing to you, and takes care of clearing the liablity as well. You can also enter no Qty at all, and just enter the negative amount of the deposit.
That's it. Works like a charm. Hope it helps :)
