General Ledger Concepts

The following is an example of how deposits are posted to general ledger when entered, applied to the invoice, voided, or forfeited. When voiding a deposit, it is assumed that the credit will be returned to the customer either as cash or a credit to the customer’s account. Therefore, when you void a deposit, a credit is placed on the customer’s account and the dealer must adjust it accordingly. If the deposit is forfeited, it is assumed the money will not be returned to the customer. It is placed into a Forfeit Deposits account listed in the (L21) Parameters screen for accounting purposes.

Note: The cash and A/R accounts are found in the (L2) screen. The Customer Deposits and Forfeit Deposits accounts are found in the (L21) screen. You must set up these accounts in the Chart of Accounts and in these parameter screens before you can enter deposit amounts.

When you Enter a Deposit:

Debit = Cash Account

Credit = Customer Deposits Account (L21)

 

When the Deposit is Applied:

Debit = Customer Deposit Account

Credit = Accounts Receivable Account (The amount is applied to the invoice, leaving a balance due on the customer’s account.)

Note: If the Auto Apply option is set to automatically apply deposits, this occurs when the ticket is billed.

If the Deposit is Voided and a Credit or Cash is Returned to the Customer:

Debit = Customer Deposits

Credit = Accounts Receivable Account

 

A ticket is added to the customer’s account with the invoice number specified in the A/R Deposit Void dialog box. (The default is 2-0). The dealer must adjust it from A/R depending on if the customer is receiving any money back.

 

If the Deposit is Forfeited, the Customer Does Not Receive the Money Back:

Debit = Customer Deposits Account

Credit = Forfeit Deposits Account (L21)