Sage 100

v5.3 Standard. My customer prepays their vendors. What is the best way record the payment to the vendor today, record the vendor invoice next week, and apply the prepayment to the invoice at the end of the month?

Look at 'Record and Apply Prepayments' in the help section. It lays it out pretty clear. Too much to type it all in here.

I have already been through the help, tested several alternatives, and talked to Sage tech support. This doesn't make sense. You enter a manual check, make up an invoice starting with ""PP"", then select a GL account to debit (I chose ""Prepaid Inventory""). Update the check register and an invoice with a 0 balance posts to the vendor aging. Right away we have an AP aging that doesn't tie out to the AP GL account. The next step is to enter the vendor invoice when it arrives (debits inventory credits AP). Finally, in AP invoice data entry, enter the vendor invoice (message appears ""it already exists). Click ""Adjust"" then go to lines and select the 0 balance prepaid invoice. The GL entries ""wash"" out correctly in the end. Here's the problema(s): 1. The AP aging never ties to the AP GL account (before the vendor invoice is entered and the prepayment applied to the vendor invoice). Theoretically you should be able to net the prepaid Inventory account with the AP and it should tie out. That is if someone didn't accidently select a different account number to apply the initial prepayment to. 2. There is no visibility. You could print an aging for a vendor that has $1M in invoices, yet no prepayments show up on the aging. You could have another $1M in prepayments so the balance should be $0! Either I am missing something or this is a complete mess.

I always thought after you wrote the check to the vendor, you also had to enter a credit in AP and use that in the prepay field in Inv DE when entering the actual invoice. This would keep your AP TB in balance.

That's a damn good idea. I am going to test it. I wonder why that isn't Sage SOP.

I just did this in my 520. the manual ck invoice gets applied to the live AP Inv using the PPD Invoice field. It is then going to only distribute the remaining balance on the lines tab. As for the aging, guessing it's not out of balance as the PP Inv is paid so not in the aging and you're taking the expense when the PP is done.

you make the original check as you would any check. Use PP to easily identify the invoice as a prepaid but its not required. When you get the actual invoice, you do NOT adjust the original PP invoice, you enter it as you would any invoice but when you get to the Prepaid Field in Invoice Data Entry, select the PP invoice entered in the first step. Not sure if this is the right way, it's how I do it.

@NancyHanson and @KennyDaniel What you demonstrated is the standard Sage method contained in the help menu. The main issue I have with that is, 1. After you enter the prepayment in manual check entry the aging doesn't agree to the AP GL balance. It is all good once the vendor invoice arrives but it is impossible to track if you are managing hundreds of prepayments. I just tested Nancy's first suggestion and I like it. It is not advocated by Sage but it works pretty well. Here are the steps: 1. Enter the manual check and charge it directly to a GL account (no invoice). 2. Enter a negative AP invoice for the amount of the prepayment charging the same GL account that was used in manual check entry step 1. 3. Enter the vendor invoice when it arrives. 4. At the end of the month use manual check entry with check # ""APP + XXXX' to apply the open prepayments to the open invoices.

Thank you for the suggestions!