Hello there, d-laxman.
You can create a bank deposit to record the payment received. This offsets the credit that sits on the vendors section.
Here are the steps:
- Click the Plus (+) icon located in the upper right-hand corner.
- Under Other, click Bank Deposit.
- Select the bank account from the Account drop-down list, and choose the Date.
- Under Add funds to this deposit, select the customer's name under the Received From column.
- Select Accounts Payable from the Account drop-down list.
- Enter the Amount of the overpayment.
- Click Save and Close.
Once done, go to the Vendors page and click the vendor's name to view the transaction list. Open the bill payment and add the deposit we just created. This will zero out the balance for the specific vendor.
Please don't hesitate to leave a comment if you have additional questions related to this. Thanks.