Paying vendor bill without marking line items of Purchase Order as received

Thanks for sharing the details with me, @jonathan_337.

You can create a Check and choose Accounts Payable in the category column since you don't want to mark the PO line items as received. This ensures your accounts are up-to-date and all of your business transactions are accounted for. Let me show you how.

1. Select + New. 
2. Under the Vendors tab choose Check.
3. Choose the Payee from the drop-down ▼.
4. From the Bank account drop-down ▼, select the account the check withdraws money from.
5. Choose Accounts Payable (A/P) in the Category details column.
6. Complete the check fields you need.
7. Select Save and close to close the check window. Or Save and new.

Then open the Purchase order and use the Copy to bill option to link with the bill. This reduces the QTY of items if you received partially delivered items, and it will update the PO's open items to track how many inventories remained undelivered.

Here's how:

1. Go to the Expenses menu, then click Vendors. 
2. Click the vendor's name to open the Purchase Order you created. 
3. At the upper-right of the PO page, click Copy to Bill. 
4. Verify the amount from the Bill.
5. Click Save and close. 

 Once you received the items, link the Bill and Check to make a payment. 

For more information about the process above, consider checking out these articles:

• Add purchase orders to expenses, bills, or checks in QuickBooks Online
• Enter a credit from a vendor
• How to use a purchase order

Additionally, I've also added these helpful articles that'll guide you in finding your purchase order transaction and some tips managing your expenses in QBO: 

• How to Run Purchase Order Reports?
• Income and expenses

If you have other concerns about receiving inventory items, purchase orders, and vendor-related transactions, please let me know. I'm just around to help. Take care always.

Thanks so much for the response! I'm trying to do this, and select Accounts Payable as the category (did not link it to PO) but I am getting a validation error saying that this account (AP) cannot be used and to select a different account. Any ideas?

Hi jonathan_337,

The output is the same, but instead of creating a check, you create an expense and do the same steps. But before doing this, be sure to switch to Accountant's View if you're currently in the Business View.

Switch to Business View:

1. Click the Gear icon in the upper right.
2. Click on Switch to Accountant's View in blue text under PROFILE. If you see Switch to Business View, it means you're currently in Accountant's View and don't need to do anything.

Record the advanced payment:

1. Click the + New and select Expense.
2. Choose the Payee name and Payment account.
3. Under the Category column, select the Accounts Payable (A/P) account.
4. Enter the amount and click Save and close.

When you receive the item, pay the bill by applying the advanced payment to it, as shown in Joesem M's screenshot above.

Let me know how the steps work for you. I'm just right here if you require further assistance.

Hello! I was able to create the expense to Accounts Payable and balance this with the Purchase Order. However, once I generate the Bill (with no payments applied to it), the line items on the purchase order are being marked as received. Any idea as to why this is happening?

Hello! I was able to create the expense to Accounts Payable and balance this with the Purchase Order. However, once I generate the Bill (with no payments applied to it), the line items on the purchase order are being marked as received. Any idea as to why this is happening? The items are no longer received if the unpaid bill is deleted.

Thanks for your prompt response, @jonathan_337. Let me share a few details about why the purchased order (PO) is marked as received.

When you create a bill against the PO, it will serve as a receipt from the vendor. This is why the purchased order is marked as received or closed and fill in the inventory item's quantity.

In this case, you're correct. You can delete the bill in order for the PO to open again and avoid filling the inventory item quantity until the item is received.

So the transaction workflow would be creating a PO, then add an expense or check for the vendor payment, and use the Category Accounts Payable. Then create a bill against the PO when you receive the items in real-time. Also, remember to link the expense to the PO once you've created a bill to make sure that the transaction is fully paid. I've added some screenshots below:

Here's how to link the expense to a bill:

1. Go to the Expenses menu and then select Expenses.
2. Click the bill you want to link the payment with the expense transaction.
3. Choose the Mark as paid button.
   
4. Check the Bill under Outstanding Transactions and the Expense payment box under Credits to link the two entries.
   
5. Hit Save and close.

You can reference the articles shared by my colleagues like how to add part of a purchase order to an expense, bill, or check and running purchase order reports.

In case you need tips and related articles in the future, feel free to visit our QuickBooks Community Help website for reference: QBO Self-help. 

If you have other concerns about receiving inventory items, purchase orders, and vendor-related transactions, please let me know. I'll be around to help you. Take care always.

QuickBooks Premier 2020

PO that are paid in full (Vendors requirement)  but not received needs to remain open.

I seem to have the same problem from every expert solution.

They always start with what to click, but do not tell you how to get to that location in the program.

"Check and choose Accounts Payable in the category column"

What category column and where?   If the start point is not know then "Select + New." has no meaning

Hello @CadMan2000,

I appreciate you for reaching out to us here in the Community. Allow me to chime in and provide some clarifications about the steps provided by my colleague.

The product attached to the user who started the thread is QuickBooks Online. The steps provided by my colleague are only applicable to those who have the same version.

For QuickBooks Desktop, you can follow these steps:

1. Open QuickBooks Desktop.
2. Click the Banking tab at the top menu bar, then select Write Checks.
3. Choose the payee next to Pay to the order of.
4. From the Bank account drop-down ▼, select the account the check withdraws money from.
5. Go to the Expenses tab. 
6. Under the Account column, add Accounts Payable.
7. Enter the amount.
8. Fill in the necessary details.
9. Hit Save and close.

To create a purchase order, I recommend following the detailed instructions in this link: Create purchase orders in QuickBooks Desktop.

I've also attached an article about Checks, like how you can delete or void them in QuickBooks: Create, modify, and print checks.

Fill me in if you have additional questions or concerns about entering transactions in QuickBooks. I'm always here to help. Take care always.

This is a useful thread, but I have one more wrinkle to add.  Our vendor is requesting a payment in advance of shipping the item on the PO (i.e. a down payment).  I have now received their invoice.  However, we are being given N/30 day terms to pay.  So can I enter the down payment bill so I can pay in on the due date, and associate it with a PO (since we have several out to this vendor), and not receive any items against it (the PO is for a fixed asset, so there is only a single unit to receive).  Thank you in advance!  I have had this situation several times already.

Congrats on making your first post, @Michael0416. I’ll help you sort this out so you can associate your PO and bill successfully.

Since you don't want to mark the PO line items as received, you can generate a check and choose Accounts Payable in the category field. I'll show you how:

1. Click + New and select Check under the Vendors tab.
2. Choose the Payee from the drop-down ▼ and select which account you'll want to use from the Bank account drop-down ▼.
3. In the Category details, select Accounts Payable (A/P).
4. Complete the check fields you need.
5. Hit Save and close or Save and new.

Next, let's associate the PO with the bill. To do so, open the Purchase order and use the Copy to Bill option. If you received partially shipped things, this reduces the QTY of items. It’ll update the PO's open items to indicate how many inventory items are still pending.

1. Go to the Expenses menu, then click Vendors.
2. Click the vendor's name to open the Purchase Order you created.
3. At the upper-right of the PO page, click Copy to Bill.
4. Verify the amount from the Bill.
5. Click Save and close.

Kindly follow the steps below to link the Bill and Check.

1. Go to the Expenses menu and then select Expenses.
2. Select the bill you want to link the payment with the expense transaction.
3. Tap the Mark as paid button
4. Check the Bill under Outstanding Transactions and the Expense payment box under Credits to link the two entries.
5. Hit Save and close.

You can visit these articles to learn more about purchase orders and vendors in QuickBooks Online:

• Add purchase orders to expenses, bills, or checks in QuickBooks Online.
• Enter a credit from a vendor.
• How to use a purchase order.

I've also added these resources to help you generate reports and manage your expenses in QBO: 

• How to Run Purchase Order Reports?
• Income and expenses.

I’d be glad to know how it goes. If you have additional vendor-related concerns, you're always welcome to drop a comment below. I'll be around to help.

Thanks JamaicaA.  I may not have been clear; I responded to the point in the post where there was a QuickBooks Desktop question, since I am also using Desktop.  It looks like this may have been a QBO response.

But more importantly, I think the answer only addresses from the point of actually writing a check going forward.  How do I start by entering a bill first, since the down payment invoice was given Net 30 terms?

Good afternoon, @Micheal0416. 

Thanks for reaching back out to the Community. I can point you in the right direction to get this resolved. 

I recommend contacting our Customer Support Team so they can use a screen share tool to help you out. Here's how: 

1. Go to the Help menu. 
2. Choose the QuickBooks Desktop Help option. 
3. Click the Contact Us hyperlink.
4. Give a brief description and hit Let's talk. 
5. Scroll down and pick to Get a callback. 

It's that easy! Feel free to come back and let us know how it went. Have a splendid day!