I hired a designer to do some work for me and she required a “mobilisation fee” which was basically just a percentage of the projected cost up front. She estimated $600, and wanted a $60 deposit/mobilisation fee*.
She issued me an invoice for the $60 and I paid it.
When it come to finalisation of the account, she itemised her time and so her invoice is inclusive of all costs (which turned out to be $605). She applied the deposit and I was required to finalise $545.
Now, I suppose I could have just entered the second invoice as $545 and be done with it. Total expenses would have been 545+60=$605 and all would be good in the world. But because she itemised where she spent the time, I recorded it likewise (just for completeness).
However this results in an invoice of $605 that has a
credit of $60 on it.
I just created a new line item on the second invoice applying a
deposit paid description to it and used a negative 60 for cost. Everything balances out (or so I think) and just because it looks ok, I just want to make sure it actually IS ok to record it the way that I have.
So put it all in picture form:
Ok, I didn’t include a pic for the initial $60 deposit
The itemised second invoice:
Summary of Expenses (Interior Design):
I personally don’t see the fact there’s a debit of 665 and a credit of 60 as they are explained in the description field and it obviously comes out correct.
I just want to make sure I’m not making some form of an accounting blunder here.
*She initially called it a mobilisation fee but on the final invoice it’s a deposit (neither here nor there).