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Level 1

Help matching a paid invoice to what it's for

I'm a new user to Quickbooks, but haven't found a solution to my problem after extensive searching (maybe I don't know the right keywords). I invoiced a client for both expenses incurred and services performed (two line items). I recorded the expenses I incurred (in this case, ads bought) under a the Chart of Accounts for this client's expenses. When the client paid the invoice though QB, I used the "Match" option to match the invoice payment to the deposit in my bank account. I see no way to reconcile in my Chart of Account that the expenses have now been reimbursed, or a way to account for the income that I have made through my services.

 

Should I instead "Categorize" and "Split" the payment into the expense accounts in the Chart of Accounts? If so any downsides that the deposit and payment aren't linked?

 

I am on the Essentials plan. Please do not tell me that the "workaround" is to upgrade to a more costly plan.

 

Thank you for your help!

1 Comment
Moderator

Help matching a paid invoice to what it's for

Let' see what we can do with the subscription you have right now, Agave1.

 

Matching the deposit to the invoice payment is correct. The reimbursement was included to the deposit you've received. You don't need to do any adjustments in the bank account. You should be able to reconcile your bank account based on your bank statement.

 

What I think that you need to adjust are the income and expense accounts. You'll need to show that the income account is not overstated while the expense is offset correctly. We're likely to create a journal entry to do this. Here's how:

  1. Click the + New button in the upper-left corner and select Journal entry.
  2. Debit the income account with the reimbursable amount.
  3. Credit the expense account with the same amount.
  4. Click Save and close.

Before doing that, I'd recommend reaching out to your accountant. They know what's the best way of correcting the balances.

 

Note: Just refresh the page if you're unable to view the articles associated to my response.

 

Let us know if you need more assistance in offsetting the expense transaction.

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