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Level 1

Company paid for another company using her credit

How do we have to record the transaction when one company used their credit to pay for another company? 

 

We do have two accounts, they pay invoices using independent ACH company. The ACH company used a credit (issued previously by us for overpayment) from Company A to apply to Company B - to pay for open invoice. Our records are separate within our QuickBooks, because these companies locate in different countries and billing addresses are different. We received the payment where Company A used their credit to pay for another company B open invoice. One company paid for another company. How correctly to record this transaction?   

2 Comments
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Level 9

Company paid for another company using her credit

Setup Due-To-From Accounts in each of the Companies Chart of Accounts.

The Company that is "Due" the money has an "Other Current Asset"

The Company that "Owes" the money has "Other Current Liabilities"

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Level 1

Company paid for another company using her credit

It is happening in our company. We issued two invoices for two different companies. They decided between each other that one company A can pay for another company B because Company A has a available credit with us.   

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