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Level 1

How to clear Account Payable balance

Back in 2012 our old accountant was taking care of our Accounts Payable. But I since have a balance from bills that were paid by means of joint checks. (Our Customer made a joint check we signed and sent it to our Vendor.) That income was not entered into QB so I can't use it to credit the bills. What's the best way to clear out that balance? 

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Best answer 12-20-2018

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Level 15

"But I since have a balance from bills that were paid by...

"But I since have a balance from bills that were paid by means of joint checks."

Meaning, you did not even have to pay that, so it is not something you incurred.

"(Our Customer made a joint check we signed and sent it to our Vendor.) That income was not entered into QB so I can't use it to credit the bills. What's the best way to clear out that balance?"

Well, overlooking that Gross Income is the place to start, then.

It either is your cost and your income, or None of it is yours. You cannot split that at will.

If you have costs used for tax filing and reporting, and if you have payroll labor and other costs incurred for providing some sort of good or service to that customer, then that Is your income, or revenue from a sale. That means you need to catch up that missing info, then use it to pay the bills.

You can set up a "Clearing bank" to manage that there are no Funds being exchanged; you essentially have a barter situation, that the customer used your payment to pay your Vendor.

Or, as I pointed out, none of this was your cost or your revenue and you were not even involved. But "joint checks" sounds like part of Business Operations, to me.


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3 Comments
Level 15

"But I since have a balance from bills that were paid by...

"But I since have a balance from bills that were paid by means of joint checks."

Meaning, you did not even have to pay that, so it is not something you incurred.

"(Our Customer made a joint check we signed and sent it to our Vendor.) That income was not entered into QB so I can't use it to credit the bills. What's the best way to clear out that balance?"

Well, overlooking that Gross Income is the place to start, then.

It either is your cost and your income, or None of it is yours. You cannot split that at will.

If you have costs used for tax filing and reporting, and if you have payroll labor and other costs incurred for providing some sort of good or service to that customer, then that Is your income, or revenue from a sale. That means you need to catch up that missing info, then use it to pay the bills.

You can set up a "Clearing bank" to manage that there are no Funds being exchanged; you essentially have a barter situation, that the customer used your payment to pay your Vendor.

Or, as I pointed out, none of this was your cost or your revenue and you were not even involved. But "joint checks" sounds like part of Business Operations, to me.


View solution in original post

Level 1

Re: "But I since have a balance from bills that were paid by...

I have a balance carrying over from 2015. A check was written through A/P instead of issuing a refund from a credit memo after paying an invoice. I reconciled the check in 2015, but since I was told to create the credit memo and issue the refund. This has cleared the customer's account to zero, but now I am carrying a positive balance.

How can I fix this? Thanks!

Moderator

Re: "But I since have a balance from bills that were paid by...

Hello 307Clerk,

 

You'll have to delete the check after the invoice was paid. Then, you'll have to  link the A/P check of the vendor by changing the account payable to account receivable to offset your balance.

 

Go back to the A/P check and change it into Account Receivable.

 

Fill me in if you need more help with the QuickBooks transactions.

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