Enterprise v24 was released to the ProAdvisor community last September (2023) and the general public the following month. It contained a new feature called Prepayments (Customer Deposits). This was probably one of the most requested features ever and one of the most needed to halt the practice of recording negative Accounts Receivable.
Whether you called these prepayments Customer Deposits, Retainers, or Prepayments, before the new feature, most QuickBooks users recorded payments against an invoice that didn't exist, resulting in improper accounting under GAAP, or they used a complex workaround involving a two-sided item pointing to a liability account for prepayments.
The new feature allowed Enterprise v24 users in the U.S. and Canada to receive and track prepayments on Sales Orders. Late last month, QuickBooks Enterprise expanded the prepayment feature to allow the recording and tracking of customer prepayments on Estimates.
Customer prepayments tied to Estimates can be applied automatically as a payment when the Estimate is converted to an Invoice. Recording and tracking customer deposits or prepayments on Estimates will save time and improve users' bottom lines.
Notice (in the screenshot above) that a Receive Payments button has been added to the Main Task Bar at the top of the Estimate. A new Prepayment checkbox (shown in the screenshot below) is available by default when you open a Customer Payment using the Receive Payments button. Note also that this prepayment checkbox is available on all Payments received but allows you to select prepayments for an Estimate or an existing Sales Order.
Feature users will ensure customer trust by sharing printed or emailed Estimates with proof of Prepayment (as shown below).
This method ensures the accurate recording and accounting of Prepayments as Current Liabilities (as shown in the transaction journal below) instead of negative Accounts Receivable. Users can easily roll back prepayments for Estimates to make needed corrections before a Prepayment is applied to an Invoice.
Enterprise v24 users will have better visibility into prepayments for all their transactions using the "Open Prepayments by Customers" report (shown below).
A revised Payments Template within the newest release (R7P) of Enterprise 24 allows you to turn any payment into a prepayment for either a Sales Order or Estimate (as shown below). When a single related transaction of the type exists for that customer, it will default to the template; when multiple transactions of the type selected exist, a pop-up list allows users to select the appropriate transaction for the Prepayment.
This is another significant enhancement to QuickBooks Enterprise. With the ability to apply prepayments to either Estimates or Sales Orders and track those prepayments to the final Invoice, users can finally ensure that they are correctly posting prepayments according to GAAP standards without the complexity of entries requiring manual reversal.