QuickBooks Tutorial: How to Record Customer Prepayments

In this video I will show you how to record deposits or prepayments from your customers in #Quickbooks. You can use this method for the desktop version and for QuickBooks Online.

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[beyondmassage]

Hi EC, are you still offering online tips? I find you very easy to understand and I have a question about the next step of prepayment when the client actually starts to pay for the service and it how to do that so it is recorded properly. I understand the first step so thank you so much for that!!

[GH-wwrv]

Is this a cash basis company? For some reason I cannot find assistance for a cash basis company that is recording a customer deposit received in one FY and customer deposit applied to their invoice in the following FY. Any assistance here is greatly appreciated!

[KathleenMcLaughlin-sr]

In your 2, 000 prepayment example - if you run an AR Aging Summary will this 2000 appear as a negative on the report or not at all

[j.t.]

Your video fails to state when the prepayment is actually deposited into the bank account. Does the bookkeeper DEPOSIT the prepayment into the company's bank account after the Sales Receipt is recorded and before the prepayment is applied to an Invoice?

[coolgranny]

Dear EC.
Thank you for your thorough explanation. My situation is different, I first submitted an invoice to the client for the total value of the job. The client paid. Now I have to create credit memos against the money received and submit them to the client showing the progress of the job and the balance they have in their favor. I don't see this operation anywhere. First the invoice then the credit memo. Thank you.

[nansimbisharifah]

What if I deal in products rather than service what would I use in the invent

[debbieruss]

Hello, what is the process when you Invoice a customer for lets say annual rent, receive payment and now need to defer the payment for the rest of the year. this would be for accural basis

[mahmoudmohamed-xdls]

what about undeposited funds account ? will shown always in customer statement? how we can close this account to be zero also if we received the prepayment from customer in cash and will not deposit it in bank ?

[johnashley]

Example: The amount of prepayment is $50, 000 and it is for the entire year for multiple invoices. After the first invoice of $5000 and using the prepayment item, would the invoice show the remaining $45, 000 or a "0" balance due. Please advise.

[migueljps]

What if my customer pays for the landscaping services in advance (for the entire season):
LAWN MOWING $1000
SPRING/FALL CLEANUP $500
LAWN FERTILIZER PROGRAM $295.
How can I manage this in a monthly basis and how will I know the individual customer's credit balance if i have multiple customers that prepaid the same way.

[dustinohanlon]

So there is no way to know what my customer's prepay balance is? Let's say that invoice was for $1000 and you only used $1000 of prepay. Will I be able to know that my customer only has $1000 of prepay left to use?

[AngelaPoplawski]

But doesn't this lower your booking sales? Instead of it booking $5, 000 now its only booking $3, 000?

[mbimbi]

How do you enter a customer prepayment on an estimate? Oct 9, An estimate total for Mr T, $3921, a 25 percent deposit is required on acceptance of estimate. On Oct 9, Customer prepayment: From Mr T, $1000 as deposit on estimate paid by credit.

I think there is simple method you can do it...go to receive paymet-select customer-enter amount-make it save...no need complecated way