What does this procedure allow you to do?
This procedure will help you properly record payments or invoices for services that we are receiving. With larger and larger funds being moved around in our accounts we need to be able to record these in the proper location and time frame in our books.
Who can do this
Anyone with access to our books and invoices.
What you need
- Access to Xero
What discrete actions constitute the procedure? Make sure to nest them as appropriate.
Pay an Invoice for a vendor.
The first step is to pay an invoice for a vendor. Sometimes we pay chunks of funds ahead of time and then they provide services until those funds run out.
In Xero, split the payment across the months that we will receive service from that vendor.
Review the example below. We paid the full amount to our vendor in the month of November which covered the full quarter. Because we haven't received the services for this yet we put a portion of those funds into the pre-payments account.