How does assigning a payment on account effect the general ledger?

Hi - I’ve just read another conversation re this, it’s now closed hence the new topic.

I’m giving advice to my friend who uses Quickfile, regarding taking deposits. The article suggested, tagging a bank transaction as payment on a/c to the customer sub ledger then, applying the credit to the invoice at a later time.

We tried this however it confused me as the double entry doesn’t look complete as the GL shows a Dr for the Cash as expected but no Cr was showing which I expected would show in a Pro Forma / Retained Deposits type liability ac. Please could you advice.

Many thanks.


System reduces debtors balance
entry would be
Dr cash
Cr debtors

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Thank you for your reply. That makes sense and it’s what’s been happening. Invoices have been out in the system dated for the delivery date - so the sale is recorded at the correct time.

However when producing a bal sheet at year end the debtor ac is showing as a liability. This is a timing issue.

Eg. YE 31/03/2014

Sales Date - 1/6/2014
Dr Debtors 500
Cr Sales

Deposit paid - 1/3/2014
Dr Bank 250
Cr debtors

Te above has happened server times, so at ye the debtors accounts has all the deposits in the GL to rev with payment date but future debtors bal is in the future so at ye it’s technically a libilty.

Would a reversing solve this, I.e dropsy amount…
Dr debtors
Cr deposits held for eg?

Thank you.

You can do journal adjustment for final accounts
Dr Debtors
Cr Payment on account

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