How to create vendor prepayment in Dynamics 365?

A-prepayment from payment journal
B-prepayment from purchase order

A-prepayment from payment journal 

1-create prepayment posting profile

Go to accounts payable /setup/vendor posting profile

you can create prepayment posting profile per (vendor group /specific vendor /all vendors) from Account code

assign the summary account and sales tax prepayments if you need

2-Setup Accounts payable parameters to use prepayment posting profile

Go to accounts payable /setup/Accounts payable parameters/ledger and sales tax tab


select the prepayment posting profile 

3-create payment journal

Go to accounts payable/payments /payment journal




 click lines and select enter the vendor and amount with the offset account for your prepayment 

then go to payment tab and check vendor profile with the prepayment and click prepayment journal voucher 



post the payment journal 


B-prepayment from purchase order

1-to create prepayment from the purchase order, you must set up prepayment for item

go to inventory management /setup/posting/posting /purchase order tab

click prepayment checkbox to set up prepayment per (item/item group/all items /category) as the below


Note:
(in Dynamics AX 2012, you can access category from procurement and sourcing /set up /categories/procurement categories)
or (product information management/set up/categories /categories hierarchy)

but in dynamics 365, you can access it from  (product information management/set up/categories and attributes /categories hierarchy for association ) only


2-create purchase order

go to accounts payable /purchase order/all purchase order

click new purchase order and select your vendor, and add your items

click prepayment


you can create prepayment as a percent of the net amount or fixed amount

select the prepayment category id and click save

confirm the purchase order

3-create prepayment invoice

click invoice tab and click prepayment invoice


enter number and invoice date


click post

to view prepayment invoice click invoice tab and click the invoice button in journals


4-create payment journal for prepayment

Go to accounts payable /payments/payment journal

create payment journal and click lines to select your vendor


click settle transaction to select your prepayment and click ok

click post

5-Create prodct receipt


enter product receipt number and click ok to post product receipt


6-invoice purchase order and apply the prepayment

click invoice in invoice tab

enter the invoice number and invoice date and click apply prepayment button



click post.

Thanks.