Partial Prepay to Vendor

Sometimes a partial payment is paid to a vendor to lock in a specific price for product that will be purchased at a later date. An example of this might be prepaying $0.05 per gallon for Propane to the vendor which locks in an actual product cost of $1.05 per gallon.

1. If an add-on charge for partial vendor prepay doesn’t already exist, go to Setup / Inventory / Purchase Add-on Charges and select Add to create a new Purchase Add-on Charge. Enter an ID, Description, Rate Type, and Bill Type. The rate may be set as a Percent, Per Billing Unit, or a Flat Rate. This rate type is editable at the Purchase Order depending on the contract type being prepaid. The Classification is an optional setting. If used, this add-on Charge defaults onto any line item containing a product with a matching classification. This new add-on must be marked Included in Vendor’s Bill to influence the amount paid.
   
2. Add a Purchase Order from Inventory / Purchase Orders.
3. Mark the Prepay option on the Purchase Order.
   
4. Select the product being purchased and set the $/Unit as the amount being prepaid.
   
5. Double-click in the Add-On field. If the add-on charge doesn’t automatically show in the grid, double-click on <Charge ID> and select the partial prepay add-on charge.
6. Set the Rate as the unpaid amount and set Calculate as to Per Billing Unit.
7. Choose Calculate. This displays the unpaid portion that will later be billed for this Purchase Order. Note that the New $/Unit for this line item displays the full amount of the unit price so the product’s cost will be correctly updated.
   
8. Save the purchase add-on. 
9. The Purchase Order now displays the amount booked. Selecting Apply calculates the amount of Prepay.
10. The PO can now be received against on a Purchase Receipt as normal. The add-on charge follows through based on the Purchase Order set up and quantity received.
11. The Purchase Receipt can then be imported into a Purchase Invoice. The add-on charges setup on the Purchase Order follow through the Purchase Receipt into the Purchase Invoice.