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Free Accounting Software Forum - Prepaid inventory

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24/07/2014

Thanks very much for FAS - it's really user-friendly.

Please excuse my ignorance - but just have a query about how to handle inventory that's paid for in advance. I have watched the video to help set up measurables and have gone through the forums - but I am not quite sure how to set things up if I have made 2 or more advance payments and then received my inventory a month or so later.

Any assistance would be much appreciated.
17/08/2014
If it is a deposit with the final balance paid when you get it enter a payment to an asset account called deposits. Then when you make the final payment enter a 2 line payment. The first line is the total cost and the second line is negative for the deposit. Make sure you reconciled the deposits account.

If you paid the full amount then just record it as per normal.

If you don't want it to go into your stock until you receive it then set up an inventory that points to an account called "Inventory - in transit". Then when you get it enter a general journal to transfer it to the normal inventory account. See the manufacturing inventory videos.
 

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