can i record a deposit received to an open sales order?

Question

Acctd4 · Answer

The 1st (Sales Receipt) transaction puts the deposit into the liability account but the 2nd (Tax Invoice) transaction is also required in order to clear it out again!   How has the final sale been being recorded & the deposit on it been being reflected ?  Where to go from here, depends what's been happening/reported so far.

Note: Usually, there's no GST on Deposits so no tax codes are used on these transactions.  However, be aware that if you've only been invoicing remaining balances, you've been under reporting both sales income & its GST 😫

Firstly, I'd recommend generating a report on your Deposit Received account & identifying which (if any) Deposits are still actually being held currently.

leeannhoward · Answer

The second example is how we would like to do as the liability account "deposit received" is currently being used.However Im pretty sure not correctly. There are multiple deposits and they are being recorded as a negative amount on the sales order to the deposits received liability account, a tax invoice is being raised for the deposit amount and reconciled against the bank. But the deposits liability account is never debited ? Can you advice on how to remedy ?

Acctd4 · Answer

Not specifically but there are a few ways you can handle it .....

* Receive the payment as normal under the Customer/Customer Job & it will reflect as a Credit until you convert the SO to an Inv, at which point you then apply the payment to it
* Setup 2 Deposit Items - 1 for upfront received as an "Other Charge" type & 1 for allocation as a "Discount" type, both linked to a newly-created Liability account (eg "Deposits Held")   Record the Deposit (received upfront) via a Sales Receipt then minus the Deposit line off (using the allocation discount) on the subsequent Inv

The first option is far simpler but if multiple deposits are frequently held &/or for extended periods of time, the second option allows for tracking & reporting of this in more detail.