Customer invoice underpaid form previous fiscal year

Hey there saskks,

Welcome to the QuickBooks Community! Thanks for reaching out to us here. QuickBooks Online is a great tool able to help keep your books balanced. I would be happy to provide some information.

It's important to ensure that you've completed all of the required elements when writing off 'bad debt' in QuickBooks Online. Once you've set up the expense account and created the 'bad debt' item, you'll need to create a credit memo to be applied to the associated invoice. Click here to review the required steps. If the books have been closed for that period, you'll need to have them opened in order to save the changes. As you're aware, this can cause a negative impact on other areas of the books, so I do recommend confirming with an associate, that this would be the best course of action, in this situation.

I hope this helps!

So I did a journal entry instead of credit memo.

AR credit

Bad Debt debit

Can I now apply it to the invoice with current date or will this mess up the last fiscal year?

Welcome back!

Creating a journal entry will move the funds from one account to another.  However, as indicated in the article I provided above, creating a credit memo can be applied to the outstanding invoice, so it's no longer showing an open balance.  If you're not certain, please speak with your accounting team for further confirmation.