Prepayment, Proforma and offset
Options
LeeMills77
Registered Posts: 1 New contributor 🐸
Hi all,
I've come across a situation I can't fully grasp on its resolution and it's quite important because it's a considerable amount of money.
Basically, I have a debtor who were set up as a proforma account, then moved to a normal credit account, but it's unclear to me what they should be paying. I'll try and explain below the situation:
Debtor made two prepayments:
1st Mar -30,000
2nd Mar - 20,000
Then we raised 2 proforma invoices for the same value:
1st June 30,000
2nd June 20,000
The prepayments were used to clear other invoices, while the proforma invoices were paid using other payments they had made (confusing I know but this is the account I've inherited from somebody else).
To confuse things even further, both prepayments were offset in invoices recently raised - for example:
Invoice 123 - was 45,000, but proforma for -30,000 is included in the invoice - payable balance = 15,000
Invoice 456 - was 33,000 but proforma for -20,000 is included in the invoice - payable balance = 13,000
It's not a bookkeeping question but more a general credit control question - what exactly should the debtor be paying because I haven't quite got my head around this.
If you can explain step-by-step I'd appreciate it because it hasn't quite sunk in yet!
Thanks for reading,
Lee.
I've come across a situation I can't fully grasp on its resolution and it's quite important because it's a considerable amount of money.
Basically, I have a debtor who were set up as a proforma account, then moved to a normal credit account, but it's unclear to me what they should be paying. I'll try and explain below the situation:
Debtor made two prepayments:
1st Mar -30,000
2nd Mar - 20,000
Then we raised 2 proforma invoices for the same value:
1st June 30,000
2nd June 20,000
The prepayments were used to clear other invoices, while the proforma invoices were paid using other payments they had made (confusing I know but this is the account I've inherited from somebody else).
To confuse things even further, both prepayments were offset in invoices recently raised - for example:
Invoice 123 - was 45,000, but proforma for -30,000 is included in the invoice - payable balance = 15,000
Invoice 456 - was 33,000 but proforma for -20,000 is included in the invoice - payable balance = 13,000
It's not a bookkeeping question but more a general credit control question - what exactly should the debtor be paying because I haven't quite got my head around this.
If you can explain step-by-step I'd appreciate it because it hasn't quite sunk in yet!
Thanks for reading,
Lee.
0