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Join nowMy company leases products to customers. I was told since we offer $1 buyout at end of lease to treat as a sales-type lease and given a journal entry to record lease receivable, Interest receivable etc. However my question is If I make a journal entry in order to record this how can I make an invoice for the monthly amount to my customers. Won't I be double booking?
Glad to see you in the Community today, NatalyMarie.
Thanks for sharing a screenshot of your concern and for being detailed about it.
Based on the scenario, create an invoice for the lease items instead of entering a journal entry. This is to ensure the products leased and income is properly tracked in QuickBooks.
If you haven't added the products, let me share the steps on how to perform this task. We’ll have to perform this process one at a time for each product.
After setting up all these items, I suggest reversing the journal entries to avoid duplication of records. Here's how:
You'll see a new entry with R beside the entry number and credit amounts reversed. Then make invoices for the items leased.
Please know if you enter a journal entry for the accounts receivable, the transaction is subject to the following restrictions: You cannot use more than one A/R or A/P account in the same transaction, and Transactions to accounts receivable must include a customer.
I’m adding a link containing a breakdown of articles. Each one contains information to help get acclimated about the product’s features and processes: Get Started.
If there’s anything else I can help you with, let me know in the comment box below. I’ll get back to assist further. Have a great rest of the day.
Thank you for your response however you are suggesting I simply set up an invoice for products but what about the remainder of the lease. For example if we lease an item for 24 months where would we record the remaining account receivable?
Thanks for getting back to us, @NatalyMarie.
To record your lease items for 24 months, you can create an invoice that is good for 1 year. This way, you can easily track the total receivable, and when your customer pays the invoice, you can add a payment.
After doing the steps provided by Rasa-LilaM, you can begin creating the invoice.
Here's how:
Feel free to check out our Help articles if you need help processing sales and managing customers.
Don't hesitate to drop a comment below if you have other QBO concerns. I'm always here to help.
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