I need help recording a few transactions. I am the parent company (corporate office) for a few daycares. We recently purchased a radio ad for our area. These ads will be an expense for the daycares. However, the radio company requires one big lumpsum payment therefore I paid for this upfront from the corporate account. Each daycare will now pay the corporate account back for these ads. How do I show this on my books?
Hi there, Childcare Company.
Welcome to the Community. Helping you with recording a payment on behalf of the customer in QuickBooks Online is my priority.
When receiving a payment from a collection agency on behalf of the customers, you can set up the collections agency as a customer so you can keep track of the payments.
After that, you'll need to enter a Journal Entry to distribute the payment from the collections agency to the correct customers.
To do that:
Select the Plus icon (+) at the top and then Journal Entry.
Enter the Date the payment was received.
On the first line, select the Account drop down and choose Accounts Receivable.
In the Debit field, enter the full amount of the payment.
In the Memo field, note the reason for the journal entry.
Select the Name drop down and select the collections agency name.
On the second line, select the Account drop down and select Accounts Receivable.
In the Credit field, enter the payment amount for the first customer.
Select the Name drop-down and choose the name of the customer where the payment is being transferred.
After all the customer payments are distributed, select Save.
This journal entry will create an open balance for the collections agency and list a credit to the customer's account.
Now, you'll have to enter the payment from the collections agency to deposit the funds and clear out the collections agency balance you just added.
However, if the collections agency deducted a commission, you can record that when you make the deposit, you'll need to follow these steps:
Lastly, apply the credits created by the journal entry to close the customer's outstanding charges.
That should guide you on your way to successfully record the payment made on behalf of a customer on your QuickBooks.
Please let me know if you have any questions about these steps. I'll make sure to get back to you as soon as I can. Have a wonderful day.
On the parent's books, create a new "Due from Daycares" as a parent account. You can then create subaccounts for each daycare center under the parent account.
To create new accounts: From the Dashboard > Accounting > select Chart of Accounts > Select New >
Account Type = Other Current Assets
Detail Type = Other Current Assets
"However, the radio company requires one big lumpsum payment therefore I paid for this upfront from the corporate account."
Just split payment transactions using these accounts.
"Each daycare will now pay the corporate account back for these ads."
When you receive the payments, use these accounts.
You can View Register balance with transactions. Just go back to the Chart of Accounts to review those accounts.
Hello. I was following your steps to record a payment made on behalf of a customer as I received payment from a collections agency and I ran across an issue that I am hoping you can help me with. I created a new customer using the collection agency info. Then I went to create a journal entry.
In your first step of entering a Journal Entry to distribute the payment from the collections agency to the customer, you state to Debit - Accounts Receivable and select the collection agency from the Name drop down. Then on the second line you say to Credit - Accounts Receivable and select the customer whose invoices were paid by the collection agency in the Name drop down.. Quickbooks will not allow 2 - AR or AP accounts in one Journal Entry. What do you suggest I credit instead? I have tried a couple other of my accounts, but they did not create a credit on the customer side that I need to pay the invoices on. Thank you.
It's lovely to see you here in the Community, Andrea31,
I'm here to help you create a journal entry for your payments distribution.
May I know if you're using QuickBooks Desktop? If so, there's a different process to transfer your customer payments from one customer to another. The steps above only apply to QuickBooks Online. Let me get you on the right track.
First, you'll need to create a wash account, so you can move the money from one account to another when you cannot do it directly.
Once done, you can create a journal entry to transfer the amount from the collection agency to the clearing account. Here's how to that:
Once done, you can now link the payment to the journal entry. Let me guide you on how to do that:
After linking the payment, you'll need to create another journal entry to move the payment from the clearing account to the customer. Please follow the steps below:
Lastly, you can now apply the credit to the unpaid invoice. Here's how:
Please feel free to update me if you need further assistance. I'll be your personal QuickBooks guide. Have a good day!
I wanted to reply quickly with a Thank you for taking the time to help with my issue. I am using QB Premier 2018. As soon as I have some time this week I will walk thru the steps your provided.