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Thread: Advance payments received from a Customer

  1. #1
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    Advance payments received from a Customer

    A Client received and advance payment in the previous fin year, for work to be completed in the next fin year. It was a substantial amount.
    Invoices are only to be processed once the work is completed, which is in the new fin year
    What would the correct entries be for the previous fin year, when the funds were received?

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    Hi,

    You would debit your bank account and credit either the customer account so it appears as a credit in the debtors age analysis or a current liabilities account which you can call Advance payments from customers.

    Regards,

    Companyservices

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    @Allbalance, just for interest sake, is this client registered for VAT?

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