Releasing Retainage for Vendor Invoices

How Do I...

When your vendors have completed their jobs, they will release the retainage by sending you a statement or an invoice for the retained amounts. To release the retainage in Sage 50 follow these steps:

  1. Create a Service item in Inventory for Payables Retainage. Make sure that the Payables Retainage general ledger account is entered in the GL Salary/Wages Acct field for the Service item. Although this step is optional, it will ensure that when you use this item on your purchase invoices the correct general ledger account is selected automatically. ClosedStep-by-step instructions

    a. Select Maintain > Inventory Items. This will open the Maintain Inventory Items window.

    b. Enter an Item ID and Description.

    c. Select Service as the Item Class.

    d. Leave Price Levels set to 0.00 and enter the Payables Retainage account in the GL Salary/Wages Acct field.

    e. Select the appropriate Item Tax Type.

    f. Click Save.

  2. Create a purchase invoice selecting the appropriate vendor, date, and so on.
  3. In the line items, select the Payables Retainage Service item and enter the amount of released retainage on the vendor’s bill.
  4. Save the invoice. The retainage will now be handled as an aged payable and you will be able to pay the vendor accordingly.
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