Wow, you guys are amazing.  I understand accounting perfectly well.  Here is the question I have for you, for the 3rd time.  Let's see if you can actually try to answer it this time...

If a client uses the 'deposit' box on an invoice instead of deducting a deposit as a line item where does the 'deposit' get recorded? 

For background here is what has been discovered so far...

1) There is no record of it in undeposited funds so it isn't posting there.  2) Removing it does not change the P&L in any way so it is not posting directly to an income account.  3) It is also not posting directly to the bank account.  

Since this is a QBO created account can you please tell me where I can see it on a report.  What account is it suppose to be posting to?   

Sincerely,

Dawn