You can enter the advance payment for a supplier as Supplier Credit. When a bill comes in, the credit offsets the due amount.
Here's how to create a Supplier Credit:
To apply the credit to an open bill:
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Similar to the above question, but instead of a credit applied to the account by the supplier, what is the correct way to account for Direct Debit payments made to a supplier's account, prior to receiving a VAT invoice from the supplier for the services. We are just finalising our VAT return, and will not have another invoice that falls into the period.
We have the payments going out of the bank, but nothing to be able to apply them to our energy suppliers account in QBO.
Thanks in advance.
If your accounting basis is cash, you might want to record the advance payment through journal entry, accounts146.
This will be a great alternative for recording the transaction instead of creating supplier credit.
Please check this out for steps to create a journal entry: QuickBooks Online.
If your accounting basis is accrual, then you might want to record the bill first. It’s because the method records expenses when they’re incurred.
Lastly, I’d recommend consulting an accountant when doing so. This is to make sure everything is recorded correctly.
Our doors are always open if you need anything else.
"If your accounting basis is accrual, then you might want to record the bill first. It’s because the method records expenses when they’re incurred. "
This answer is nonsense.
I might pay a supplier say £500 because that is all I have available in my bank to pay the supplier's bill or account balance of for say £743.86.
So how do I post my £500?
Create a credit note for the difference? Nonsense!
I am going to have to change to say Sage - which can accept such payments on account.
I have helped install mega-systems like SAP and Oracle, so I know what I am talking about!
can i assume that from this you cant post payments on account in quick books. i have paid 6k for someones expenses but i haven't got time right now to enter the invoices for the 6k but i want my payment to him to show as if i have overpaid him (ie a minus figure) - that way i wont forget to enter all the expenses and claim the vat...
Hello Amanda, you can create a cheque and in the account select creditors and select the payee's name that will show is if you have overpaid as it will not be allocated to anything until you allocate it if that makes sense.
no that's the one - however just figured out how to do it - you go into pay an invoice, then unallocated any invoices by unticking them then just type the payment amount - that leaves it on account.
Could you tell me how you managed to get a credit as a payment on account to how on the supplier account?
We have paid a company twice and therefore have a payment showing in the bank account that I want to reconcile and put the amount as a credit on the supplier account but can't see how to do it.
Hello there, @M I C.
Thank you for joining here. I see that you're trying to look for a way to get a credit as a payment to the supplier account.
We can create a cheque affecting the bank and AP account with the supplier. It will serve as credit that you can use when paying bills to your supplier.
These articles provide more details about utilizing Cheque:
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Hi, thanks for the response but I don't want to raise a cheque, we have already paid the supplier. I want to show the amount we have paid them as an amount on the supplier account that they owe us like a supplier credit but they haven't actually sent us a credit note.
Hi M I C You can, as suggested create a cheque, or an expense and in the memo enter a note relating to what it is e.g. a payment on account. When you then receive the invoice bill and create it on the supplier account you can select the cheque/expense and add the bill from the right hand menu.
You could also create the cheque/expense and enter the creditors account in the category column and also enter a note in the memo box relating to what the payment is for. When you receive the invoice/bill, create it and select make payment the cheque/expense will be linked to the payment.
Another method would be to create a bill payment. When you're in QuickBooks you can enter billpayment after/app/ (it would then look something similar to this https://app.qbo.intuit.com/app/billpayment ) this will enable you to enter the Payee name, the date the payment was made, the account the payment was made from and the amount.The amount will then appear as an unapplied bill payment on the suppliers account. When you receive and create the invoice/bill and select make payment you can attach/use the unapplied payment to pay the bill.
Hi, the problem with what you have suggested is that it just clears the amount in my bank and puts a charge into my expense account, however the cheque or expense on the suppliers account just appears as a normal bill that has been paid, it doesn't show as a balance on the account that they owe us. There will be no flag therefore on the account to show that we have paid more than we should.
HI M I C If you choose the oprion to enter creditors within the cheque/expense then this won't affect any expense accounts and will be clssed as an amount that the creditors owe you although on the supplier account it will appear as being paid that's why we suggested entering a note in the memo box. If you use the bill payment method suggested this doesn't use any expense account and appears as an unapplied bill payment on the suppliers account.