Receiving an Advance Payment from a Customer
You wish to receive an advance payment from a customer prior to shipping goods. What is the recommended flow of events?
There are two options to collect an advance payment from a Customer. The absolute easiest is to simply enter a Customer Deposit whenever the Customer sends the advance payment. The drawback to this method is that no invoice is actually generated in advance. If you need to generate an actual invoice to collect the advance payment then you would need to follow the process detailed below:
Create an advance payment descriptor
Create a descriptor that will be used to represent an advance payment. It can be assigned a Descriptor Type of ‘Misc’.
Create sales order
Create a Sales Order for the items being sold. Enter the full price against them.
Enter two additional lines, both using the ‘Advance Payment’ descriptor. Let’s say the customer is making an advance payment of $100. Enter one line for $100 and a second line for -$100.
Pick advance payment line
Now go to Order Picking and pick the first descriptor line for $100.
Create and enter payment for invoice
In the Sales Order, create an invoice for the advance payment line. Then go to AR - Customer Payments and select and pay the invoice. The customer has now made his advance payment.
When the items are finally ready, go Order Picking and pick the items, as well as the second Advance Payment line for -$100. This negative Descriptor offsets the selling price of the items by $100 since that was already received against the prepayment invoice.
Now enter an invoice for all the items plus the second advance payment line for -$100. Thus, the total invoice amount will be reduced by the amount of the original advance payment.