When a vendor requires a deposit, you can generate a purchase with the deposit value as a line item. Navigate to the Management screen in the purchase order and then to the Purchases tab. Click the 
symbol next to "Pur." Select "Deposit" from the drop-down menu.
This will create a purchase with the deposit as a line item. This line item sits on the balance sheet as an asset.
To reverse this deposit when the purchase is fulfilled, follow these steps to create an expense recognition purchase.
In the Categories module, you will see that the Deposits category has Vendor Deposits in the “Acct # Cost” field. This is the GL Account used when this category is purchased from a vendor.
For example, if you placed an order with a vendor worth 17,500 with a 10% deposit, you would have an asset of 1,750 in your general ledger.
To generate the expense recognition purchase, navigate to the Management screen in the purchase order and then to the Purchases tab. Click the 
symbol next to "Pur." Select "Purchase" from the drop-down menu.
The purchase will have a line item to recognize each expense as well as a line item to reverse the deposit.
Once the expense recognition purchase is opened, the deposit is removed from the asset account.
