advance payment

Payroll Accounting (PY)

This is a lump-sum payment of income which has already been earned but for which payroll accounting has not yet been performed. Such payments are usually effected between two ordinary payments of either wages or salaries.

Rather than pay the full amount of earned income after each payroll run, many companies and organizations prefer to effect one or even several advance payments during the payroll period. The advance payment is roughly equal to the amount of income which the employee has already earned.

The exact amount of remuneration is calculated later. The advance payments are deducted from the total and the employee receives the remaining amount, usually when wages and salaries are paid in the following month.

Real Estate (IS-RE)

Payment made by customer in advance for service charges likely to be incurred:

SAP Utilities (IS-U)

Budget billing amount according to the budget billing plan. It is paid before the utility company has rendered services.