We typically have to bill for our customers to initiate prepayments and on occasion the billed prepayment isn't received within the same month. The dollar amount is material and the timing is such that the A/R would be on the books at quarter-end, so I'm wondering if it is appropriate to record an A/R and customer prepayment/deferred revenue liability transaction at the time of invoicing the customer? Or, should we wait to record a transaction until prepayment funds are received and record the cash and deferred revenue at that point?
USA Customer Prepayment Transaction Timing When Invoicing for Prepayment
- Thread starter stnsaztec
- Start date
Lost. Second sentence says A/R would be on books at Qtr end and implies that this is bad. But your third sentence says you propose to book a Dr to A/R as your workaround. How is the first mentioned A/R bad and your proposed entry to A/R any better?
Anyway, use the second method (your last sentence).
Anyway, use the second method (your last sentence).
Last edited: