About deposit invoices

When a client makes a deposit, an invoice is generated with the deposit value as a line item. This line item sits on the balance sheet as a liability. To reverse this liability when the order is fulfilled, follow these steps to create a revenue recognition invoice.

In the Categories module, you’ll see that the deposits category has Customer Deposits in the “Acct # Rev” field. This is the GL Account used when this category is invoiced to a client.



For example, if you had a client place an order worth 25,588.82 with a 10% deposit, you would have a liability of 2,558.88 in your general ledger.



To generate the revenue recognition invoice, navigate to the Management screen in the order and then to the Invoices tab. Click the Plus.png symbol next to Invoice. Select Invoice from the drop-down menu.



The invoice will have a line item to recognize each source of revenue as well as a line item to reverse the deposit.



When the invoice is posted, the deposit is removed from the liability account.


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