Non-profits - My customer is also my vendor and there is a balance

NotaNewMember · ‎February 05, 2021

I use Premier Nonprofit 2019. I have a school account and a lunch program account. Same school but separate accounts. Payroll goes through the school account then the lunch account reimburses the school monthly.

This year being different, the lunch program hasn't paid the school yet this year and the school has received a grant which also funded the lunch program.

The school has to allocate the grant money to the lunch program and then deduct what the lunch program owes the school. There is a credit balance towards the lunch program.

The lunch program owes the school but has a credit from the school.

How do I do this in the school account? I have set up a Clearing account but, how do I set up the grant as a credit for the lunch program and what is owed from the lunch program? There will be a small credit balance for the lunch program in the school account when it is done.

JonpriL · ‎February 05, 2021

Hello @NotaNewMember,

You have two options to enter a credit balance depending on how you track the funds in question. Let me show you how.

To start with, these are the choices you have for the steps in recording a credit balance:

Money out - Give your customer a credit or refund in QuickBooks Desktop for Windows
Money in - Record a vendor refund in QuickBooks Desktop

However, it is best to consult your accountant for accuracy in handling the credit balance and funds of your nonprofit account. If you haven't yet, here's a link you can use to find one near you: Find an accountant or bookkeeper.

Lastly, I've also included this reference for a compilation of articles you can use while working with us: Help Articles for QuickBooks Desktop.

If you have any other questions, please let me know by leaving any comments below. I'll be here to lend a hand.

NotaNewMember · ‎February 10, 2021

It worked in the sense of Invoices and credits. But when I looked at the P&L it still showed the lunch program owing the same amount. I did not show the balance of what the school owes. Why doesn't it show in the P&L?

The school received money for the grant. I'm trying to avoid the the school writing a check to the lunch program. The lunch program owes the school but less then what the school owes the lunch.

Let's say the school received $5000 that was meant for the lunch program. But the lunch program owes the school $4000 for payroll. The lunch program will have a credit of $1,000 taken off their next bill.

So when the lunch program owes $2000 I will only have to pay $1,000.

MirriamM · ‎February 10, 2021

Hello again, NotaNewMember.

To start, you'll need to record the grant which the school received. Deposit the funds and use other income as the source of the deposit. However, it would be best to work with an accountant for professional advice in dealing with this type of situation to make sure everything is recorded accurately, especially in recording the credit balance.

You can find an accountant if you don't have one yet by clicking on this link: Find an accountant.

Feel free to comment below if you have any other questions or concerns. I'm always here to help.

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Non-profits - My customer is also my vendor and there is a balance