How can I include a deposit from a customer on an invoice?

In accrual accounting, deposits need to be treated as liabilities until the job is delivered. The deposit is an advance or a prepayment from your customer as per your business need. To record this advance payment while creating an invoice, take the following steps.



Step 1: Create a Chart of Account

First of all add a new Chart of Account, Advance or Prepayment as Current Liability.



Step 2: Create a New Invoice 

1. Go to Transactions and click Invoices.





2. Click Add New.





3. Enter the required information of the customer you are sending the invoice to.


4. In Invoice Details add two line items, the first one with income type of chart of account and second for deposit.





5. Once verified, click Approve & Send.


6. Add the deposit as Receive Payment against the invoice.







Step 3: Create Manual Journal 

1. Once the service is provided, create a Manual Voucher.


2. Debit the Advance Payment (Prepayment) and Credit the income chart of account.





 3. Click Post.





Please note Once the Journal is posted, it will zero out the amount under Advance Payment in Balance Sheet.



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