This article is for the case when you have created a purchase order and need to prepay for purchase orders before the goods on the PO is received.
First, you would need to go to Setup, Bills settings, Check the checkbox->
Show Purchase Order Item Prepayment inside Bill Item Form section. Save the setting by clicking on Update Configuration.
There are 2 ways to create a bill to prepay the PO.
Create the purchase order as you normally would. Use the Prepaid PO option under More button when viewing a PO to create a new bill. You would be asked to enter the amount to prepaid. This amount cannot exceed the total of the PO. A bill will be created and come up on the screen. Go to the bottom of the bill to the post and pay area. Choose the cash or bank account you will be using to prepay the bill. Then hit post and pay.
The other option is you can create a new bill to the supplier and link the bill item to the purchase order for prepayment.
To pay for the entire purchase order or a percentage of it, create a new bill. In the bill item form, Click on the list under Prepayment for Products on P/O. This shows you all open PO items without prepayment, choose the items you are prepaying. A new bill item is then created. The quantity on the bill item is locked to the total quantity on the purchase order line. To change the amount you are paying for the PO, change the price to control the final amount. Go to the bottom of the bill to the post and pay area. Choose the cash or bank account you will be using to prepay the bill. Then hit post and pay.
When the bill is posted, the system would post an entry that debit the supplier prepayment account and credit the accounts payable.
When posting the shipment receipt on goods on a PO that is prepaid , the system would find out if any quantity on the PO is already paid (on a bill). If the received quantity is considered prepaid, the system would debit inventory asset and credit supplier prepayment for this supplier (normally accounts payable is used).
After the inventory for the PO is received, you will create a new bill to pay for the inventory received via Link to Received Item from Receipt option. The system will calculate the remaining amount to pay based on the PO total and the prepayment total. The remaining amount is defaulted as the new bill item amount. You can override the amount to be the actual bill amount.
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