Accepting Down payments on jobs (Accrual basis of accounting)
Has anyone found a good work around for accepting down payments for jobs that will not start for at least 4-6 weeks. We are on the accrual basis of accounting and currently JobNimbus has us doing an invoice for the down payment then posting a payment against that invoice. This invoice transfers to Quickbooks as unearned revenue which is where it's supposed to go. W
Weeks later, when we start the job, we convert the estimate to an invoice when recognize the income. The problem is the people are getting confused as to what to tell the client they need to collect by the time the job gets finished because they are seeing two invoices and one payment.
Is there anyone in the roofing industry that has found a better way to do this. Please remember you need to be on the accrual basis of accounting for this problem.
Your suggestions are much appreciated!
Dom Robin commented
To the OP, this just came up with our new bookkeeper and fractional CFO.
Solution: invoice only for downpayment, apply downpayment and close out invoice. When the job is finished, invoice the balance and apply payment when received.
We had the same issue with recognizing revenue.