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How to enter outstanding balances for customers and vendors

The method for entering outstanding balances for customers and vendors depends on when you started using QuickBooks Online. Generally, it depends on whether they had balances before your QuickBooks Online start date, or after your start date.

Note: If you want to keep track of individual sales or bills that make up your customer and supplier opening balances, enter each unpaid invoice and unpaid bill instead of entering a total balance for each customer and supplier.

Setting up a customer opening balance

  1. Select Sales, then select Customers.
  2. Select New Customer upper right.
  3. Enter customer information.
  4. Go to the Payments and Billing which is between the Tax info and Attachments tabs, then enter Opening Balance and as of date (most likely the date you started your QuickBooks Online account).
  5. Select Save.

What accounts are impacted when entering a customer Opening Balance?

When entering an opening balance during a customer setup, income and Accounts Receivable (A/R) or Trade and other Receivable accounts are impacted. The income account is the default account when the QuickBooks Online subscription is created. It appears in the Credit column on the transaction journal and can be edited once the original transaction is created.

To edit the income account that the opening balance is assigned to:

  1. Select Sales, then select Customers.
  2. Select the customer.
  3. Select the Opening Balance Invoice.
  4. In the Product/Service column, select the ▼ dropdown and choose another item.
  5. Select Save.

Accounts receivable appears in the Debit column of a transaction journal. This represents that the customer still owes you money and will stay in Accounts receivable until the invoice is paid.

How to set up a supplier opening balance

Here's how to set up a supplier opening balance in QuickBooks Online:

  1. Select Expenses, then Suppliers.
  2. Select New Supplier/Supplier on the upper right.
  3. Enter required information for vendor or supplier.
  4. Enter Opening Balance and as of date (most likely the date you started your QuickBooks Online account).
  5. Select Save and close.

What accounts are impacted when entering a Vendor/Supplier Opening Balance?

When entering an Opening balance during a vendor/supplier setup, income and Accounts Payable (A/P) or Trade and other Payable accounts are impacted. The Expense account is selected as the default account when the QuickBooks Online subscription is created. It appears in the Debit column on the transaction journal and can be edited once the original transaction is created.

To edit the expense account that the opening balance is assigned to:

  1. Select Expenses, then Suppliers.
  2. Select the vendor, then select the Opening Balance Bill.
  3. Change the expense account in the detailed line item of the bill.
  4. Select Save and close.

Accounts Payable appears in the Credit column of a transaction journal. This represents that the business still has a credit memo or balance due to the vendor/supplier. Accounts Payable will be impacted by this opening balance until the bill is paid.

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