Prepayments for Stock Items
Our company buys large machines from their supplier. Due to the many business factors in these purchases, sometimes the supplier will ask us to make prepayments for the machines. However, at the time the PO is created, we do not know if there will be prepayments or not. And, if there will be prepayments we also don’t know if there will be only one, or several prepayments.
The current process that we are using involves creating a Standard Voucher when the manufacturer sends a prepayment invoice. We charge a Prepaid Asset account for this voucher. The prepayments are charged to an account that has a subledger that represents the PO number for the machines.
The current process that we are using involves creating a Standard Voucher when the manufacturer sends a prepayment invoice. We charge a Prepaid Asset account for this voucher. The prepayments are charged to an account that has a subledger that represents the PO number for the machines.
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