In NetSuite, we can work with vendor prepayments in two different ways:
- The vendor prepayment is associated with a purchase order. We can associate one or more vendor prepayments with a purchase order for the same vendor. When the vendor prepayment and the purchase are associated, you can configure NetSuite to automatically apply the vendor prepayment to the vendor bills.
- The vendor prepayment is not associated with a purchase order (stand-alone vendor prepayment).When the vendor prepayment is not associated with the purchase order, NetSuite cannot apply the prepayment to the vendor bills automatically. In this scenario, we must apply the vendor prepayment to the bills manually.