Invoice customer for deposit

Software: QuickBooks accounting software

“Can you send me an invoice for the deposit that I have to pay?”

You can create a Sales Invoice, stated the goods and services that they purchased, send it to your customer and requesting for payment. This method will debit the Accounts Receivable account and credit Sales Income account.

The arguments for this transaction will be if this is a project and it take months to fulfil; then, this deposit will be classified as Other Current Liability instead of Sales income since goods and services was not delivered at the time of deposit made.

You may consider creating an Other Charges item in QuickBooks and linking it to the Other Current Liability account (Customer Deposit account). In Invoice transaction, select this Other Charges item (deposit should not include GST) instead of your goods and services sold to this customer. The double entry for this transaction will be debit Accounts Receivable and credit Other Current Liability account.

Use Receive Payment feature in QuickBooks to receive deposit made by customer. The double entry will be debit Bank and credit Accounts Receivable account.

When you are delivering the goods and services, create an invoice with the full amount of your actual sales (or partial amount, subjected to the sales terms between you and your customer). This will debit the Accounts Receivable account and credit sales income account.

Lastly, generate a journal to debit Other Current Liability account (Customer Deposit) and credit Accounts Receivable account to less off the deposit made by customer.

Some users will less off the deposit made by the customer (use the Other Charges item which you had created earlier) during the invoice stage and skip the journal entry.

 

2 responses to “Invoice customer for deposit

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