Apply a journal entry to a bill?

Hi there, @kbarte-1-directo. 

Thanks for reaching out. I hope you're having a great day so far.

It's important to keep in mind that Journal entries are the last resort for entering transactions. They let you move money between accounts and force your books to balance in specific ways. With that in mind, it's always best to consult with your accounting professional before making any changes to your account. If you don't have an accountant, don't sweat it. You can find one here in our Resource Center. 

In the meantime, you can use the steps I've included below to create a journal entry. For additional information about the debits and credits columns, check out Debit vs. credit accounting: The ultimate guide.

1. Select the + New button.
2. Choose Journal entry.
3. On the first line, select an account from the Account field. Depending on if you need to debit or credit the account, enter the amount in the correct column.
4. On the next line, select the other account you're moving money to or from. Depending on if you entered a debit or credit on the first line, enter the same amount in the opposite column.
5. Check the amounts - you should have the same amount in the Credit column on one line and the Debit column on the other. This means the accounts are in balance.
6. Enter information in the memo section so you know why you made the journal entry.
7. Hit Save and new or Save and close.

For more details about creating journal entries, check out Create journal entries in QuickBooks Online. 

Please don't hesitate to let me know if you have any additional questions or concerns. Take care! 
 

Tori,

Thank you for your reply.  Creating a JE was not the problem.  The problem was applying it to an open Vendor Inv., i.e vendor bill, was the issue.  After many hours & speaking with numerous QBO support folks, I finally, got a lady who knew her stuff!!  YAY!!

Again, Tori thank you for reaching out!!! º¿º  

Hi, I'm having the same issue. Can you please share your solution? Thanks!

I'll gladly share the solution needed when applying a Journal entry to a bill, kapp.

You can begin by deducting from the Accounts Payable account and crediting from a Bank or Expense account. I also suggest consulting with your accountant to ensure proper recording of what accounts to use. 

After that, create Pay bills to link it to your newly created journal entry. Doing this will reduce your total payables. Let me show you how to do it:

1. Click the + New button.
2. Select Pay bills.
3. Choose the bill you need to link to your journal entry.
4. Click Save and close.

I've attached screenshots for visual references:

For detailed instructions, see this article: Enter and manage bills and bill payments in QuickBooks Online.

In addition, check our learn how to handle bills to be paid later and bills to be paid immediately using bills, checks, or expenses for future reference: Learn the difference between bills, checks, and expenses in QuickBooks Online.

I'm always around if you need more help managing your bills in QBO. Take care!

Thank you! That was exactly what I needed to do. 

Hello kapp!

I'm glad to know that my colleague, GlinetteC, was able to help you with applying journal entries on bills. I'm sure your next transactions will be a breeze. Keep us posted if you have concerns in the future. Enjoy your day!

Hi! I’m new in Quickbooks, how can I get training, please can you share a phone number or email to get training information. I’m working with Canada’s quickbooks, my email [email address removed]

Thank you for joining this thread, Nely1401. I welcome you to the Community space.

You can access and take training courses directly from your QuickBooks Online Accountant firm. You can check these articles for more guidance about the training:

• Sign up for ProAdvisor and QuickBooks certification courses
• Find-A-ProAdvisor profile FAQ
• Training & Certification

If you have additional concerns about the training in QuickBooks Online, you may refer to this link to post your concerns: Canada's QuickBooks Community.

Hi Glienette,

Thanks for your response. I'm facing a similar issue where I have an open invoice balance created through a Journal Entry, and an open credit of the same amount to the same customer account, also created through a Journal Entry. I need to match the two. Can you please help with this? Thanks.

Thank you for coming back to this thread, kapp. I am here to assist you with matching open invoices and credit in Journal Entries in your QuickBooks Online (QBO).

First off, we'll need to make sure that the journal entry is using the Accounts Receivable. This will let you apply the entry as a payment to close out the invoice.

Here's how:

1. Open the Journal Entry.
2. Under the Account dropdown, choose Accounts Receivable.
3. Make sure all details are correct.
4. Click the Save or Save and close button to save the changes.

After that, the journal entry will be posted as a credit customer's profile. Then, follow these steps on how to apply it to the invoice:

1. Open the invoice and click Receive payment under the amount.
2.  In the Credits section, select the journal entry to apply it as a credit.
3. Select Save and close.

Let me also share this article that you can utilize in reconciling your accounts effectively in the future: Reconcile an account in QuickBooks Online.

If you need further assistance managing your invoice in QuickBooks Online, don't hesitate to reach out. I'll be here to help. Stay safe.

This is so close to what I need.  I have a customer that has prepaid their fee for current and future fees.  What is the best way to document the payment and then parse out on a monthly basis the payment to match with the monthly invoice?

How to record prepayment for services.

You've come to the right place for assistance, @lucyquick303. Let me provide insight to help you record customers' prepayments, so you can manage and streamline the accounting workflows of your business.

When customers pay in advance for services or items, you can use QuickBooks Online to record these prepayments as deferred revenue. It will create a liability account, indicating that the payment is not yet considered as earned income since the corresponding products or services have not been provided yet.

To properly account for prepayments, it's recommended to record the entire amount as a lump sum in the deferred revenue/liability account. Once the final invoice is issued, you can determine how to apply the prepayment to the invoice that includes both product and service content. This will help you accurately reflect the revenue earned and the services provided.

To keep track of the retainers you receive from your customers, you will need to create a liability account. Here's how you can do it:

1. Go to the Gear icon and select Chart of Accounts.
2. Click New. Then, select Other Current Liabilities from the Account Type dropdown menu.
3. From the Detail Type dropdown menu, Trust Accounts - Liabilities.
4. Enter a Name for the account (for example, Trust Liabilities) or accept the suggested name.
5. Select an option from the When do you want to start tracking your finances from the account in QuickBooks? dropdown list.
6. Click Save and Close.

Once done, create a retainer item to use when creating an invoice for the customer. Please follow the steps below:

1. Go to the Gear icon ⚙ and select Products and Services.
2. Click New. Then, select Service from the Product/Service information panel.
3. Enter a name for the new product or service item (for example, Retainer).
4. From the Income account dropdown menu, select the liability account created in Step 1.
5. Click Save and close.

When you invoice a customer for your services, you can apply a retainer previously received as credit towards the invoice, treating it like a payment. Here's how:

1. Open the progress entry. Then, click Crete Invoice.
2. Select the Customer name from the dropdown list.
3. In the Product/Service column, select the Retainer item we set up earlier.
4. Enter the amount received for the retainer in the Rate or Amount column. Also, the Retention.
5. Click Save and close.

Refer to the following article for detailed guidance about recording retainers or deposits from customers or tenants in advance: Record a retainer or deposit.

After that, you may refer to this article on how the Sales page gives you a great at-a-glance view of all the status of sales transactions like open and paid invoices: View sales transactions.

I will monitor this conversation for any further questions regarding managing prepayments on your account. If you have any additional queries, please don't hesitate to reply to this message, and I will be happy to assist you. Have a great day ahead!

That worked Thank you.

My colleague and I are so glad to hear that the recommendations we shared were able to help you with the issue you were facing in applying a journal entry to a bill in QuickBooks Online, AllenBlackburn.

Please remember that the QuickBooks Community is here for you whenever you need assistance with any QBO-related tasks. If you ever need more help, please don't hesitate to reach out. We hope your day gets even better, and please take care and stay safe!

I have an additional problem with this: the bill belongs to 'company A', but was paid by 'company B' in QBO. I have set up "Due To/From" accounts as long term liabilities in both my charts of accounts, but need to (1)make JE' s into each company (done) and (2) apply the payment to the outstanding bill so that it does not keep showing as unpaid in company B's books. Any thoughts on this please??