Hey Taylorshipley,
You would post a contra journal entry with the details as follows;
1) On line one of the journal entry, enter Account 'Debtors', 1040.00 in the 'Credits' box, and select the customer under 'Name'
2) On line two, enter Account 'Creditors', 1040.00 in the 'Debits' box, and select the suppliers under 'Name'
3) Save and close the journal entry
4) To link the journal entry to the invoice, go to the customer > new transaction > payment and tick the invoice (showing under 'Outstanding transactions' against the journal entry under 'Credits'. The amount recieved should show as 0.00. Save & close.
5) To link the journal entry to the bill, go to the supplier > new transaction > cheque and tick the bill against the journal entry as above
Thanks!
