I have customers and vendors. I act as the middleman between them. I receive payments from my customers and then transfer that payment to my vendors with a service fee deducted. How do I put this into accounts? I will put in customer payments as sales, What do I put for the vendor payments with my service fee? Do I write an invoice or bill for my vendors?

Honestly... I would seriously consider taking an accounting class in your local community college. You can open yourself up for costly mistakes and audits if you do things wrong.