Enter a prepayment (advanced payment)

Find this screen

Open: Nominal > Enter Transactions > Prepayment Journal Entry

How to

Enter a prepayment

Open: Nominal > Enter Transactions > Prepayment Journal Entry

  1. Enter the details of the initial transaction. This posts the total value of the expense to the balance sheet.
    1. Prepayment Date: Date of the initial transaction.
    2. Total value: For the initial transaction.
    3. Reference and Narrative : For all the transactions.
  2. Specify the Transaction Analysis code, if required.
  3. Choose the nominal account for Balance Sheet postings. This defaults to the prepayment account set on the Default Nominal Accounts screen.
  4. Choose the nominal account for Profit and Loss postings. This is usually the same nominal account as the original expense was posted to.
  5. Enter the Date and Value for each required periodic transaction.

    The total value of the periodic transactions must equal the Total value of the initial transaction.

    The routine suggests tomorrow as the first periodic date, plus dates for each subsequent posting at regular intervals.

  6. To save and post all the transactions, click Post.

Useful info

Set up a nominal account for prepayments

To set up your prepayment nominal account:

  • Create a nominal account to hold your prepayment and post the periodic transactions from.

  • Set this as the default nominal account for prepayments so it is automatically displayed when prepayments are set up.

Applying a prepayment

To apply a prepayment you:

  1. Post the payment that is to be accounted across a number of periods. You could post this as a:
    • Purchase payment to a supplier account.
    • Cash (nominal) payment (with or without VAT).
  2. Enter the prepayment. When you enter the prepayment you must specify:
    • The date on which the payment was made and its amount.
    • The Balance Sheet nominal account that will temporarily hold the transaction. If you have a default prepayments nominal account specified Sage 200cloud will automatically display this to you.
    • The Profit and Loss nominal account into which the payment amount will be posted over the course of the prepayment period.
    • The number, amount and date of individual payments to be posted to the Profit and Loss nominal account.

What happens when

I post a prepayment?

  • An initial transaction is posted to the following nominal accounts:

    Nominal Account Debit Credit

    Prepayment Account

    (Balance sheet)

    Total Value

    Expense Account

    (Profit and Loss)

    Total Value
  • Period transactions are posted to the following nominal accounts:

    Nominal Account Debit Credit

    Prepayment Account

    (Balance sheet)

    Period Value

    Expense Account

    (Profit and Loss)

    Period Value

Note: A single URNThe unique reference number assigned to a complete transaction to assist in tracing the progress of the transaction through Sage 200. This number is 12 digits long and comprises of: 3 digits for the user number, 2 digits for the source module in which the transaction was created, and a 7 digit sequential reference number. is applied to all the transactions.