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Intuit

Unapplied cash payment income on your profit and loss

When you run a Profit and Loss report using the cash method, you may see Unapplied cash payment income.  This account is created by QuickBooks for proper tax reporting.

Unapplied cash payment income may appear on your report if:

  • A customer prepaid you and you recorded the payment before creating the sales form (invoice or sales receipt).
  • You entered payments without matching them to sales forms.

The following steps will help you resolve Unapplied cash payment income on your Profit and Loss report. 

Step 1: Run the Open Invoices report

To run the open invoices report:

  1. Go to Reports.
  2. In the Find report by name field, enter Open Invoices.
  3. Set the report period, then select Run report.
  4. In the Transaction Type column, locate a transaction listed as a Payment.

If that Payment  transaction matches an open invoice, go to Step 2. If you don’t see a matching open invoice, go directly to Step 3.

Step 2: If the Payment transaction matches an open invoice

If that payment matches an open invoice, follow these steps.

  1. Select the Payment date to open.
  2. Under Outstanding Transactions, check the open invoice.
  3. Select Save and close.

Step 3: If the Payment transaction doesn’t match an open invoice

If the payment doesn’t match an open invoice, you’ll need to create the transaction. Follow these steps: 

  1. Select + New.
  2. Under Customers, select Invoice.
  3. Fill out the form with the same customer, amount and date as the payment.
  4. Select Save and Close.
  5. Go back to the Open Invoices report.
  6. Find the unapplied payment, then select the date to open.
  7. Under Outstanding Transactions, check the open invoice.
  8. Select Save and Close.
  9. Check your Open invoices report to see if there are any more transactions listed as a Payment. If there are, repeat step 2 for each one.

Now run your Profit and Loss report again. You should no longer see the Unapplied cash payment income. 

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