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Champ003
Level 1

Deferred Revenue

We just had a large event cancel and asked our paid customers if they wanted to rollover their payments to next year's event.  A large number of these clients replied yes, they wanted to roll their funds to 2021.  These clients have been invoiced and invoices have been paid in full.  My question will I have to do Journal entries on every customer invoiced (about 200) to move funds to deferred revenue?  Can I open the invoice and change the GL codes to deferred revenue instead of J/E? Just trying to think of options to make it look clean in reports and easy for auditors to understand.  I did refund receipts for everyone that asked for a refund and credit memos for everyone that had a unpaid invoice in order to take out of A/R, but still show the initial revenue on the P&L. Thanks for your help.

5 Comments 5
katherinejoyceO
QuickBooks Team

Deferred Revenue

Hi there, @Champ003

 

Thanks for visiting the Community. I appreciate you for sharing the details of your concern. 

 

In your case, you'll need to use the Expense or Check since the customer made a prepayment for an order but decided to cancel it before receiving the goods or services. Here's how: 

 

  1. Select + New, then select Expense or Check
  2. Select the customer you want to refund from the Payee drop-down list.
  3. Select the bank account where you deposited the payment from the Payment account drop-down list.
  4. On the first line of the Category column, select an Accounts Receivable, then enter the refund in the Amount field.
  5. Enter all other necessary info in the fields, then select Save and close.

 

Once done, link the refund to the customer's credit to complete the process. Here's how:

 

  1. Select + New, then select Receive payment or Receive invoice payment.
  2. Choose the same customer you used for the check or expense.
  3. Enter all necessary details in the given fields.
  4. Under the Outstanding Transaction section, check the box for the Expense or Check you've created.
  5. Ensure that the payment is equal to the open balance, then Save and close.

 

See this article for more information: Record a customer refund in QuickBooks Online.

 

Concerning with the invoices that are paid in full, you can't change the GL codes to deferred revenue. The best option is to create a credit memo or use the journal entry so you can apply them in the future invoice. Refer to this article for more information: Enter and apply credit memos and delayed credits in QuickBooks Online

 

For the unpaid invoices, you have the option to void them. 

 

You may also want to check out this help article for your future reference: Handle a customer credit or overpayment in QuickBooks Online. It helps you learn about what you can do in case you'll have an overpayment situation. 

 

Let me know if you additional questions. I'll be around to help. Stay safe.

Rustler
Level 15

Deferred Revenue


@Champ003 wrote:

We just had a large event cancel and asked our paid customers if they wanted to rollover their payments to next year's event.  A large number of these clients replied yes, they wanted to roll their funds to 2021.  These clients have been invoiced and invoices have been paid in full.  My question will I have to do Journal entries on every customer invoiced (about 200) to move funds to deferred revenue?  Can I open the invoice and change the GL codes to deferred revenue instead of J/E? Just trying to think of options to make it look clean in reports and easy for auditors to understand.  I did refund receipts for everyone that asked for a refund and credit memos for everyone that had a unpaid invoice in order to take out of A/R, but still show the initial revenue on the P&L. Thanks for your help.


The issue is to remove the current income and hold it as deferred income. do a journal entry

debit current income for the total amount

credit deferred income, customer name 

credit deferred income, customer name

etc

explain in the memo block

 

deferred income is a liability account

Champ003
Level 1

Deferred Revenue

Thanks everyone...the journal entry was my only option.  Is there a way to show the Deferred Revenue on the P&L so the board can see the revenue and total refunded/deferred/uncollectable all in one place?  I would then move it to the Balance Sheet right before the audit. When I put it below the line it comes up as a negative number. 

Angelyn_T
QuickBooks Team

Deferred Revenue

Thank you for getting back to us here on the Community page, @Champ003.

 

When recording entry for your current and deferred income, it'll always show up when running the Profit and Loss report. Just make sure to customize the report's period correctly.

 

I've added these screenshots for your visual reference.

b2 1.PNG b2 2.PNG

 

Also, check out this article for additional reference about running and customizing reports in QuickBooks Online: Run reports in QuickBooks Online.

 

Get back to me if you have any other questions. I'm always here to help. Have a good day!

3DMpam
Level 1

Deferred Revenue

I had a similar problem, used a JE to move income to deferred revenue, but . . . now I need to make a refund to someone whose funds are in deferred revenue.  Can I simply use the reverse button on the JE to put the funds back in current income to make the refund?  Or, do I have to make a new JE to reverse it?

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