Found this in Accounting section under Vendor payment before PO is issued:
 
Quote:
 
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