Hi there, @whittk.
Let me share with you what's causing this error message.
Once you create a check or expense transaction and use an expense account to record the advance payment, it will cause an error once you use it to pay the bill that you've created. You can check out the screen shot below as your reference:
To fix this, you have to open the check or expense transaction again and change the CATEGORY to Accounts Payable (A/P).
Then, go back to the bill and select Mark as paid to apply the check/expense credit to it.
This will show the check/expense that you've created in the Credits section. After this, check the boxes for the bill and check/expense to apply the credits. Finally, select Save and close.
In addition, you can run the Transaction List by Vendor report in QuickBooks. This will show you the list of expense transactions grouped by vendor. Just go to Reports and run the Transaction List by Vendor report.
The Community always has your back, so please let me know if you have any questions. Have a great day.
I thank you for your reply. Why does this only occur with an expense for a credit card transaction and not a check payment? I have no issues when applying an invoice to a prepayment check using the same expense account. The error message is something that just started as I have used an expense account for a credit card transaction in the past. Also, if I have closed my monthly, quarter, etc books then changing an account creates a problem. What would be your suggestion in this instance without creating journals? Could using QB online make the difference rather than a desktop version.
Thank you for your prompt reply. I'll handle this query for you.
What we suggest are the same steps provided by @ReymondO above. It applies to both an expense or a check transaction. The important step is to use the Accounts Payable (A/P) account, which allows you to link the expense or check as payment to your next bill.
Take a look at this article for more details: Enter a credit from a vendor. It has the steps on how you can enter vendor credits, which allows you to choose a specific expense account for your vendor.
I'll be around in case you have other concerns. Leave a comment, and I'll get back to you.
I'm sorry I guess I did not explain correctly. This is how I enter a check prepayment using the below accounts
1450 Supplier Deposits
|Other Current Assets||Prepaid Expenses|
|10/12/2020||Check||Vendor||Authorization ID aoofqx1h||$1,467.00|
A bill/invoice is transferred into QB using account accrued payables
Applying the prepay to invoice
I bring up the prepayment check, the invoice automatically opens on the side and click add, enter the dollar amount, save and close. The invoice is now paid by the prepayment. This function does not work when I make the prepayment using a credit card instead of check I use expense. This procedure has worked many times before but now it does not. I am using QB online.
I do thank you for your assistance and comments.
Thanks for getting back to us, @whittk,
We have an ongoing issue with some customers getting errors when adding a bill to an existing Check or Expense. Our engineers are working on the fix and were looking into getting it available as soon as possible.
In the meantime, the fix they recommended is by applying a bill payment. Here's how:
1.Open the bill you created earlier.
2.Click on the Mark as Paid button.
3. Enter info on the bill payment check, then press Save and close.
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