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How to link a check to a Bill

Here is my situation. I am a general contractor. One of my subs (Vendor) needed a down payment and I did not have a Bill from them yet. I wrote a check for the down payment in February.  Now in March I received the Bill for the full amount. How do I apply the check from February to the Bill I want to enter in March.  I also need to add that I used the Items (not expenses) Tab in the Write Checks screen and that I have already billed the Home owner (Customer) for the down payment. [Meaning I can't edit the check and change the expense to accounts payable and the customer job to the vendor because the charge has already been marked as "billed" to the Customer].

Is there a way to do this?  Right now I have entered the March Bill in full and added another line item with a negative amount to showcase the down payment.

Best answer 03-20-2019 01:20 PM

Accepted Solutions
QuickBooks Team

Re: How to link a check to a Bill

Hi there, DTetzlaff.

 

Good to see you here in the Community. I'm by no means an accounting professional, but I do have some insight to provide that can help get you on the right track.

 

In situations like this, it's still generally recommended that you change the expense to Accounts Payable. This is the ideal way of applying a down payment check to a bill. For additional insight about this, you can check out this article: Record vendor prepayments or deposits for prepaid parts or services

 

However, please be sure to reach out to an accounting consultant to ensure this method is the best suit for your business. With Intuit's Find-A-ProAdvisor site, you can search for certified professionals in proximity to your ZIP code that can discuss options more personal to your business's needs.

 

Please let me know if you need further assistance with this, I want to make sure this is taken care of. Have a great day!

3 Comments
QuickBooks Team

Re: How to link a check to a Bill

Hi there, DTetzlaff.

 

Good to see you here in the Community. I'm by no means an accounting professional, but I do have some insight to provide that can help get you on the right track.

 

In situations like this, it's still generally recommended that you change the expense to Accounts Payable. This is the ideal way of applying a down payment check to a bill. For additional insight about this, you can check out this article: Record vendor prepayments or deposits for prepaid parts or services

 

However, please be sure to reach out to an accounting consultant to ensure this method is the best suit for your business. With Intuit's Find-A-ProAdvisor site, you can search for certified professionals in proximity to your ZIP code that can discuss options more personal to your business's needs.

 

Please let me know if you need further assistance with this, I want to make sure this is taken care of. Have a great day!

Established Member

Re: How to link a check to a Bill

I am going to mark this as an acceptable solution because it will work in the future. It does not answer my question on how to fix what was done in the past. I had special circumstances that this general solution does not address.

QuickBooks Team

Re: How to link a check to a Bill

Hello there, @DTetzlaff.

 

I appreciate you for taking your time in getting back to us. I'd like to furnish you with additional information on how to link the check you've entered to a Bill.

 

There are two options on how you can record vendor prepayments or deposits for prepaid parts or services

  • Use Accounts Payable to record prepayment
  • Use an Asset account to track the prepayment

Here's how to record and link your transactions:

  1. Create an Other Current Asset (OCA) account to track prepayments.
    1. Go to the Lists menu.
    2. Select Chart of Accounts.
    3. In the Chart of Accounts, right-click anywhere, then select New.
    4. From the Other Account Type drop-down, choose Other Current Asset.
    5. Click Continue.
    6. Enter Prepaid Inventory as the Account Name.
    7. Hit Save & Close.
  2. Write a check to your Vendor.
    1. Click the Banking menu.
    2. Select Write Checks
    3. Enter the vendor name, date, and the payment amount.
    4. Go to the Expenses tab.
    5. In the Account column, select the OCA account.
    6. Select Save & Close.
  3. Enter the bill when the items arrive.
    1. Select the Vendors menu.
    2. Choose Enter Bills.
    3. Go to the Expenses tab.
    4. Choose the OCA account.
    5. Enter the amount of the prepayment as a negative value.
    6. On the Items tab, enter the items.
    7. Click Save & Close.
  4. Pay the bill balance.
    1. Go to the Vendors menu.
    2. Select Pay Bills.
    3. Choose the balance due after the prepayment is applied.
    4. Click Pay Selected Bills.

That should do it! This will allow you to accurately record your vendor prepayments and link it with a bill.

 

Stay in touch with us here in the Community if you have other questions about managing vendor prepayments in QuickBooks Desktop. I'm always here to help.