I know I have posted this before but I tried a search on several keywords and came up empty so here it is again. And for future searches - ADVANCE PAYMENT or PREPAYMENT or DEPOSIT on PURCHASE ORDER.

1. Create a type N part number called prepayment.
2. Add 2 lines to the purchase order, one for a positive quantity and one for a negative quantity of prepayment for the amount of the deposit so the net total of the PO is unchanged.
3. Receive the positive line, process through AP and cut a check using a dummy vendor invoice number.
4. When the actual parts are received, receive the parts and the negative deposit line so the correct net balance due passes to AP for payment.