Clean up Accounts Payable

Mary with WestCoast · ‎July 26, 2023

How should we handle last years vendor bills that show Open in QuickBooks Online, but in fact have been paid outside of QuickBooks? We know that we cannot change last years information because last years taxes have been filed already with the current information QuickBooks Online has. What is the proper way to handle this so we can get last years bills to show paid without affecting last years reportings?

Should we do a Vendor Credit dated in the current year and apply to those bills? If so, what account should we use on line 1 of the vendor credit.

Or should we do a Journal Entry dated this year hitting Accounts Payable and another account. Then go to pay bills and select all the open bills from last year and the journal entry to cause it to clear out and show $0.00 paid? I know for the journal entry we would have to hit accounts payable, but I'm not sure due to the situation if we would use the regular account Cost of Sales or a different account due to the situation. Any assistance is greatly appreciated. We have an accountant, but try to be as self sufficient as possible.

ChristineJoieR · ‎July 26, 2023

I can see the relevance of closing these unpaid bills from the previous year, @mary. I can share some insights to manage these unpaid bills in QuickBooks Online.

We can mark the bills as paid to close these transactions. Doing this will show adjustments to your book for the current year.

Here's how:

Go to the Expense tab, and click the Bill section.
Track the bill.
Once done, tap the Mark as paid.

Furthermore, you can also consider getting some advice from your accountant to keep books accurate and expense accounts to use. Do you want to have one? Visit this article: The ProAdvisor Program.

I'll be around the corner if you need additional support managing your bills and expenses in QuickBooks Online. Have a great day.

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