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Re: Pre-paid inventor



In any case... it should be a liabilty account ("internal transfers" as mentioned by Marjan is), because they owe you money, until they deliver.

Bert.

On Wed, Mar 10, 2010 at 10:51, Iserv-appbox <..hidden..> wrote:
IMHO the common solution for this kind of problems is to use a "internal transfers"
account. (I'm not sure if I use the correct term. In Dutch we call this "kruisposten".)

When paying in advance you book:

Âchecking account: Credit
Âinternal transfers: Debet

If you connect the internal transfers account with AR_paid, AP_paid, you can "pay"
the real invoice using the internal transfers account as a pseudo checking account.

Marjan Waldorp,
tux4u.nl


Joseph wrote:
> On 03/09/10 14:15, Chris Travers wrote:
>> On Tue, Mar 9, 2010 at 11:32 AM, Joseph <..hidden..> wrote:
>>> How to handle correclty pre-paid inventory?
>>>
>> Can you be more specific? ÂWhat do you mean "pre-paid?"
>>
>> Best Wishes,
>> Chris Travers
>
> What I mean is you pay for supplies/goods first before you receive them.
> Eg. Supplier sends me "proforma invoice" and I pay it but I don't receive the goods till maybe after two months; meantime I have to reconcile the bank
> statement.
>


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