1 Reply Latest reply on Sep 14, 2015 7:03 AM by Sergio F Oliveira

    How to enter a credit lines on a Purchase Order?

    1373078

      Business requirement

      Occasionally our vendors require advance payments in order to cover their raw material requirement before they will ship to us.  The purpose of this memo is to outline the procedures to follow in order to keep both inventory and unit costs correct:

      • Issue an expense PO to the vendor for the amount of the deposit/advance and charge it to the G/L account:
      • Issue an inventory PO for the desired quantities at the full unit cost of the item(s)

       

      o   On this same PO add an additional line that credits off the amount of the advance from above

      Instruct the vendor to bill us for the full value of the inventory shipped.

      Instruct the vendor to bill us for the full value of the inventory shipped and to show the advance on a separate line item on their invoice as a credit.

       

      Does any one know how to enter a credit line on a purchase order?

       

      Thanks,

      Iliana

        • 1. Re: How to enter a credit lines on a Purchase Order?
          Sergio F Oliveira

          Hi Iliana,

           

          As far a I know there is no way to enter a negative PO line in the PO.

          What you you can do is create the PO for the Inventory goods an enter a prepayment Invoice in AP for deposit.

          In the PO you can then refer to the prepayment number as a note to the supplier

           

          At invoice match, the financial team will be able to see that there is an invoice an a prepayment.

           

          I hope it helps,

          Sergio.