Where to key the advance payment received from the customer

You can use the Receive Payment feature to record a customer's advance payment.

To do this, start by clicking + Create and selecting Receive Payment. Choose your customer, enter the Payment date, and pick the appropriate Payment method. In the Deposit to dropdown, select the bank account where the money was deposited. Since this is a pre-payment, leave the Outstanding Transactions section blank and simply enter the total in the Amount received field. After clicking Save and close, a message will appear noting that the payment will be saved as a credit. Select Save as credit to confirm.

Then, let's generate an invoice to account for the services or goods provided. Go to + Create > Invoice, select the customer, enter the Product/Service details, then click Save and close.

Next, let's link the advance payment to the new invoice. Navigate to All Apps > Sales & Get Paid > Invoices, find the customer, and select Receive Payment. In the Outstanding Transactions section, check the box for the invoice you just created. Then, in the Credits section, check the box for the Unapplied payment. This applies the pre-existing credit to the invoice, bringing the balance to zero.

Once the transaction is complete, your customer's account balance will accurately reflect that the deposit has been used, as the status will be updated to Deposited.

If you have more questions, feel free to ask. We're here to help.