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Risho
Level 1

How do I apply a prepayment to a supplier bill?

I entered a cheque as a prepayment in August posted to A/P and entered the supplier's name under Customer/Job. Now in October, I received a few bills. When trying to pay the bills, there is no credit showing. What did I do wrong? I can't delete the cheque as it has already been reconciled.

Solved
Best answer October 26, 2020

Best Answers
LauraAB
QuickBooks Team

How do I apply a prepayment to a supplier bill?

Hello again, Risho,

 

Thanks for all of the details about what you've done up to this point to record the prepayment in QuickBooks Desktop. I know this process has a few steps to take and it sounds like you may be familiar with them considering what you've outlined here. I want to make sure you've got the right steps to get this logged correctly.

 

I recommend starting with the Record supplier prepayments or deposits for prepaid parts or services article, which walks you through how to create the cheque so that it later shows up as a credit for you to apply against the bill. The important part of the process is to make sure you're choosing the Accounts Payable account for the amount that you need as the prepayment for the bill.

 

With that in mind, the thing to check on is how you entered the cheque into the system. I see you mentioned that you've chosen the Accounts Payable, but it doesn't hurt to double check it. If needed, you may be able to simply edit the category to Accounts Payable if that's what you need to do, but it may also mean undoing the reconciliation to complete the corrections and then reconcile again afterward. Undoing a reconciliation is as simple as clicking the Undo Last Reconciliation button when you go to the Banking menu and choose Reconcile.

 

As for locating that cheque, you can look under the vendor profile in the Vendor Centre or using the Write Cheques feature and hitting the back button to find it.

 

If everything looks to be as it should, I recommend checking for data damage to your company file. Don't worry, I've got an article that walks you through this process so you can know what to expect: Fix data damage on your QuickBooks Desktop company file

 

Give those things a shot to start and let me know how it goes. I want to make sure you're good to go with this.

 

[Edited]

View solution in original post

4 Comments 4
Risho
Level 1

How do I apply a prepayment to a supplier bill?

I forgot to mention that the cheque also includes a service charge in the second line, as it was paid thru  a third party provider

LauraAB
QuickBooks Team

How do I apply a prepayment to a supplier bill?

Hello again, Risho,

 

Thanks for all of the details about what you've done up to this point to record the prepayment in QuickBooks Desktop. I know this process has a few steps to take and it sounds like you may be familiar with them considering what you've outlined here. I want to make sure you've got the right steps to get this logged correctly.

 

I recommend starting with the Record supplier prepayments or deposits for prepaid parts or services article, which walks you through how to create the cheque so that it later shows up as a credit for you to apply against the bill. The important part of the process is to make sure you're choosing the Accounts Payable account for the amount that you need as the prepayment for the bill.

 

With that in mind, the thing to check on is how you entered the cheque into the system. I see you mentioned that you've chosen the Accounts Payable, but it doesn't hurt to double check it. If needed, you may be able to simply edit the category to Accounts Payable if that's what you need to do, but it may also mean undoing the reconciliation to complete the corrections and then reconcile again afterward. Undoing a reconciliation is as simple as clicking the Undo Last Reconciliation button when you go to the Banking menu and choose Reconcile.

 

As for locating that cheque, you can look under the vendor profile in the Vendor Centre or using the Write Cheques feature and hitting the back button to find it.

 

If everything looks to be as it should, I recommend checking for data damage to your company file. Don't worry, I've got an article that walks you through this process so you can know what to expect: Fix data damage on your QuickBooks Desktop company file

 

Give those things a shot to start and let me know how it goes. I want to make sure you're good to go with this.

 

[Edited]

Risho
Level 1

How do I apply a prepayment to a supplier bill?

Thank you LauraAB.

Later I figured out that the prepayment had already been used for another bill previously and that's why it wasn't showing up as a credit.

LauraAB
QuickBooks Team

How do I apply a prepayment to a supplier bill?

Thanks for that update, Risho! That makes complete sense and I'm glad to see you were able to work that out. If the credit was used when you didn't intend it to be, the best way to prevent that kind of thing is to verify your settings in the QuickBooks Desktop. It's just a few quick steps to make sure you have the ultimate control over your credits.

  1. Select Edit from the top menu.
  2. Choose Preferences.
  3. Click Bills in the Preferences window.
  4. Choose the Company Preferences tab.
  5. Check or uncheck the Automatically use credits box as desired.

Feel free to stop by Community again if you need a hand with anything else. :) Have a great week!

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