How do I manage overpayments?
Hi. I am not sure how to deal with over payments to vendors. I am helping my friend set up QuickBooks and he usually pays more than the amount due for his mobility bill. I have entered the bills into QuickBooks, but am having difficulty figuring out how to match the payments.
When I enter the bill, should I enter only the amount due for this month or should I enter the amount and the amount credit?
I have provided an example below.
Previous amount due $236.90
Payment received Thank you Jan 4 -270.00
Credit balance $-33.10
Current charges summary
Monthly charges 224.88
Usage and long distance 11.03
Total taxes on current charges 11.24
Total current charges including taxes $247.15
Total amount due Please pay by* Feb 12, 2018 $214.05
Total GST included in this bill $11.24
Hi Lee Ann,
This is a great question. Ideally, you should pay only the amount that is due on a vendor bill. However, if for some reason that’s not possible, you should record the payment made against each bill and then when it’s time to pay the next bill apply the credit balance to the new bill and just pay the net amount. When you go in to pay a bill for a vendor you should be able to see a list of credits or QuickBooks may even ask you do you want to apply credits. If so, you need to select the credit amount or respond with a “yes” if prompted.
If you still can’t figure it out, type the keyword “apply vendor credits” into the search box for the help menu. Instructions on how to apply these credits to future billing should be listed.
Crystalynn Shelton, CPA
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