Payment done by the customer before accepting delivery of the product is an
Advance Payment. For Orders of high value, the business houses expect to
receive advance.

  
__For Example:__ Consider a customer- Jane D'souza placing an order for a double
bed costing $10000 She is asked to give some advance before the furniture
house begins work on her order. She gives them $5000 in cash.

  
Go to Accounts and open a new Journal Entry to make the advance entry.

> Accounts > Documents > Journal Entry > New Journal Entry  

Mention the voucher type as cash voucher. This differs for different
customers. If somebody pays by cheque the voucher type will be Bank Voucher.
Then select the customer account and make the respective debit and credit
entries.  

Since the customer has given $5000 as cash advance,it will be recorded as a
credit entry against the customer. To balance it with the debit entry [Double
accounting Entry] enter $5000 as debit against the company's cash account. In
the row "Is Advance" click 'Yes'.

#### Figure 1 : Journal Entry -Advance Entry  

<img class="screenshot" alt="Advace Payment" src="{{docs_base_url}}/assets/img/accounts/advance-payment-1.png">

### Double Entry Accounting  

Double entry bookkeeping is a system of accounting in which every transaction
has a corresponding positive and negative entry : debits and credits. Every
transaction involves a [debit entry
](http://www.e-conomic.co.uk/accountingsystem/glossary/debit)in one account
and a [credit
entry](http://www.e-conomic.co.uk/accountingsystem/glossary/credit) in another
account. This means that every transaction must be recorded in two accounts;
one account will be debited because it receives value and the other account
will be credited because it has given value.

  
#### Figure 2: Transaction and Difference Entry

<img class="screenshot" alt="Advace Payment" src="{{docs_base_url}}/assets/img/accounts/advance-payment-2.png">

Save and submit the JV. If this document is not saved it will not be pulled in
other accounting documents.

When you make a new Sales Invoice for the same customer, mention the advance
in the Sales Invoice Form.

To link the Sales Invoice to the Journal Entry which mentions the advance
payment entry, click on ‘Get Advances Received’.  Allocate the amount of
advance in the advances table. The accounting will be adjusted accordingly.

#### Figure 3: Receive Advance 

<img class="screenshot" alt="Advace Payment" src="{{docs_base_url}}/assets/img/accounts/advance-payment-3.png">

Save and submit the Sales Invoice.

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