If we are receiving payments on a settled acct/invoices, should the deposit be posted as a negative? Can it be applied to a specific invoice or no? (there are many)

emilee · ‎December 07, 2018

The account is a settlement, therefore the payments are going to our accounts receivable. The payments are making our bank account balance rise but they're being posted to the vendor as a negative and they aren't being applied to specific invoices.

KhimG · ‎December 07, 2018

Hello there, @emilee.

Thanks for reaching out to the Community. I’m here to share some information about receiving payments in QuickBooks Online.

Once you receive payments from your client, the deposit shouldn’t post as a negative amount. However, this would show as negative on customer’s profile if there's no invoices link to this payment.

You can apply the full payment amount to your customer’s future invoices once they are available. Do that and the negative amount will no longer show on their profile.

To link the payment to an invoice, follow the steps below:
1. Go to the Plus (+) icon and select Invoice.
2. Fill in the necessary information.
3. Hit on the Save button.
4. Click Receive payment at the top right, below the invoice amount.
5. On the Credits section, select the payment which will now show as a credit.
6. Once done, click the Save and close button. (Attached screenshots)

If you’re unable to link the payment, make sure that the account selected when the payment was recorded is Accounts Receivable (A/R). To verify, here’s how:
1. Go to Accounting from the left panel and choose Chart of Accounts.
2. Select the bank account where the deposit is deposited and click View register.
3. Choose the deposit and click Edit.
4. On the Bank Deposit screen, scroll down to Add funds to this deposit section and click on the deposit.
5. Select Accounts Receivable as the Account for this transaction.
6. Hit on Save and close.

Right after that, go back to the Receive Payment screen to link the payment to the invoice. Here’s how:
1. Click the Plus (+) icon and select Receive Payment.
2. Choose a customer and select the invoice.
3. On the Credits section, place a check mark next to the deposit to link the two.
4. Once done, click Save and close.

That should be it. Don’t hesitate to reach out to me if you have further questions. I’ll be here to help. Have a good one!

View solution in original post

Rasa-LilaM · ‎December 11, 2018

Thanks for coming back to the Community, Emilee.

You’re on the right track in managing the open invoices. I’m here to ensure the transactions are properly recorded in your account.

If these are downloaded payments, matching them to the existing invoices will close out the transactions and keep your record in tiptop-shape. Once the transactions are downloaded, QBO suggests possible matches based on existing entries, such as payments from customers, so you don’t have to manually add them.

This helps avoid having a negative balance. To find matching transactions, follow these steps:

On the Banking page, select the For Review tab.
Locate the payments.
Click the Find match option.
Locate the invoices and select them one by one.
Verify that the total of the selected transactions is the same as the amount of the downloaded payments.
Click on Save.

To help give you a better idea on how QBO match downloaded transactions to existing transactions, check out this article: How to add and match downloaded banking transactions.

Let me know if you have additional questions about matching transactions. I'll be glad to keep helping. Have a good one.

View solution in original post

KhimG · ‎December 07, 2018

Hello there, @emilee.

Thanks for reaching out to the Community. I’m here to share some information about receiving payments in QuickBooks Online.

Once you receive payments from your client, the deposit shouldn’t post as a negative amount. However, this would show as negative on customer’s profile if there's no invoices link to this payment.

You can apply the full payment amount to your customer’s future invoices once they are available. Do that and the negative amount will no longer show on their profile.

To link the payment to an invoice, follow the steps below:
1. Go to the Plus (+) icon and select Invoice.
2. Fill in the necessary information.
3. Hit on the Save button.
4. Click Receive payment at the top right, below the invoice amount.
5. On the Credits section, select the payment which will now show as a credit.
6. Once done, click the Save and close button. (Attached screenshots)

If you’re unable to link the payment, make sure that the account selected when the payment was recorded is Accounts Receivable (A/R). To verify, here’s how:
1. Go to Accounting from the left panel and choose Chart of Accounts.
2. Select the bank account where the deposit is deposited and click View register.
3. Choose the deposit and click Edit.
4. On the Bank Deposit screen, scroll down to Add funds to this deposit section and click on the deposit.
5. Select Accounts Receivable as the Account for this transaction.
6. Hit on Save and close.

Right after that, go back to the Receive Payment screen to link the payment to the invoice. Here’s how:
1. Click the Plus (+) icon and select Receive Payment.
2. Choose a customer and select the invoice.
3. On the Credits section, place a check mark next to the deposit to link the two.
4. Once done, click Save and close.

That should be it. Don’t hesitate to reach out to me if you have further questions. I’ll be here to help. Have a good one!

emilee · ‎December 10, 2018

Thank you for all the insight! I've applied the deposits to the appropriate invoices but on the "client" screen, it still lists the total deposit amount per line item as a negative number.... is this because the "accounts receivable" account is being lessened with each payment?

HoneyLynn_G · ‎December 10, 2018

Thanks for getting back into this thread, @emilee.

I'm here to provide some more details about resolving a negative deposit in QuickBooks Online.

To begin, let's create a journal entry. This is to move the funds from Undeposited account to the bank. Next thing to do is group the journal entry with the payments to create a $0 deposit and remove the payment from Undeposited Funds.

Here's how to create a journal entry:

Click the Plus icon.
Choose Journal Entry.
Enter the Date of the transaction.
On the first distribution line, select Undeposited Funds from the drop-down list in the Account column.
Enter the amount of the deposit in the Debits column.
On the second distribution line, select the appropriate bank account from the Account column drop-down list.
Enter the amount of the deposit In the Credits column.
Select Save.

After that, here's how to group the journal entry with the payment:

Click the Plus icon.
Choose Bank Deposit.
Select the payments and the Journal Entry you created. The total should be zero.
Select Save.

For detailed instruction, please check this article: How to resolve negative deposits.

That information should resolve the negative deposits in your QuickBooks, @emilee. Let me know if there's anything else you need. I'm always here to offer help. Have a wonderful day.

qbteachmt · ‎December 10, 2018

If the invoices are settled and closed, this new activity is never a Receive Payment and it is never applied to invoices and there is No JE for this.

You use Sales Receipts. This is payment as a new Sale for you.

Or, you wrote off the old invoices to a collections account, because when you submit old AR to collections, that is a different type of asset. When you get money from the collection agency, that is a Deposit against that other current asset.

Nothing here is receive Payment. Making this AR is an error. That's why you keep getting negatives = wrong way to process the payments.

emilee · ‎December 11, 2018

@qbteachmt

Thank you so much for your help! So, we do not have a collections agency. This is just a client that owed money and we settled for less... This is a new account for me but it looks like the previous qb person just consolidated all the open invoices to 4 main open ones and she closed the rest with credit memos.... now the payments are coming in against ar, depositing positively in the bank account, but not going toward any particular invoices. Is that right? It shows the deposits as positive to the bank account but negative in the client sales screen.

emilee · ‎December 11, 2018

@HoneyLynn_G

Thank you! When the deposits come in, they are not going to 'undeposited funds' at all...

qbteachmt · ‎December 11, 2018

This part makes no sense: "just consolidated all the open invoices to 4 main open ones and she closed the rest with credit memos...."

She closed out old sales as a write off, then made a New Sale?

"now the payments are coming in against ar, depositing positively in the bank account, but not going toward any particular invoices. Is that right?"

Never; if there is an open balance you apply it. If there is no open balance, then stop using Receive Payment. That is an AR activity. You never want Negative AR; that is Backwards.

"It shows the deposits as positive to the bank account but negative in the client sales screen"

Because you "received Money and I don't know why they paid you, since they don't seem to owe me."

This is why you use Sales Receipt, instead of Receive Payment.

But you stated there is one Combined Invoice, so which is it? Did they have an open balance or not? Did the Credit Memos use an item that "closed" out the unpaid sales to a different Asset account? You have to look and understand the conditions that exist.

emilee · ‎December 11, 2018

@qbteachmt, I'm sorry I'm not making sense, I'll try to answer your questions more clearly. (I'm still trying to figure out what was done by the other person here too....)

The company does owe us money; they have 4 open invoices. The money coming in was not being applied to the invoices and so the client's open balance was going down but the invoices were remaining unpaid.... I've started attaching the payments to invoices and it looks like that's right. Now the payments are coming in the bank with the a/r account designation and they're bringing down the balance of the open invoices.

Thoughts??

Rasa-LilaM · ‎December 11, 2018

Thanks for coming back to the Community, Emilee.

You’re on the right track in managing the open invoices. I’m here to ensure the transactions are properly recorded in your account.

If these are downloaded payments, matching them to the existing invoices will close out the transactions and keep your record in tiptop-shape. Once the transactions are downloaded, QBO suggests possible matches based on existing entries, such as payments from customers, so you don’t have to manually add them.

This helps avoid having a negative balance. To find matching transactions, follow these steps:

On the Banking page, select the For Review tab.
Locate the payments.
Click the Find match option.
Locate the invoices and select them one by one.
Verify that the total of the selected transactions is the same as the amount of the downloaded payments.
Click on Save.

To help give you a better idea on how QBO match downloaded transactions to existing transactions, check out this article: How to add and match downloaded banking transactions.

Let me know if you have additional questions about matching transactions. I'll be glad to keep helping. Have a good one.

emilee · ‎December 12, 2018

@Rasa-LilaM, thanks so much! That's exactly what I'm doing moving forward!

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If we are receiving payments on a settled acct/invoices, should the deposit be posted as a negative? Can it be applied to a specific invoice or no? (there are many)