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incandescent
Level 2

How do you write off accounts receivable amounts?

Customer payment is short due to bank service charges, how do I write off this amount so it doesn't show as credit memo on invoice?
3 Comments 3
ShiellaGraceA
QuickBooks Team

How do you write off accounts receivable amounts?

Thanks for posting here today, @incandescent.

 

I have some information about the bank service charge. You'll want to edit the invoice and add a line item for the bank charge. This way, it won't show as a credit memo. Let me walk you through the steps.

 

  1. Go to Sales, and then select Invoices.
  2. Look for the invoice in question, then tick View/Edit from the Action drop-down.
  3. In the invoice, add a bank charge as a line item. If don't have a service item, tick the field and choose +Add new
  4. Pick Service and then enter the name and the account. Hit Save and close.
  5. Click Save and close. See the image below.

 

Additionally, here's a guide that covers all the tasks you can do when using the invoices and payments feature.

 

Reach out to me anytime if you still have questions or concerns with customer payments or the customer receivables. I'm always here for you. Take care and have a good one.

 

 

incandescent
Level 2

How do you write off accounts receivable amounts?

Thank you for your reply ShiellaGraceA but your method doesn't work.

 

If you add a line item for bank service charge it increases the amount of the invoice, that is not correct. 

 

If the invoice is for $1,000, the client pays $1,000 but the bank charges a transaction fee so you only receive $975 (meaning $25 was taking out of your payment for the fee). In QB desktop, the system recognizes immediately that the amount of the invoice was short paid. It asks you if you want to leave as is or write off the amount. That is a normal, common sense expected option that seems to be missing from online. 

 

My question is, in these situations, how do we write off any remaining amount of a client invoice - without reducing the amount billed to the client?

 

 

Catherine_B
QuickBooks Team

How do you write off accounts receivable amounts?

You can create a bank deposit, incandescent.

 

When entering a bank charge directly on an invoice, you enter it as a negative amount. Another way of combining bank charges and the customer payment is creating a bank deposit. 

 

Let me show you how: 

  1. Open the invoice and click Receive payment at the upper-right.
  2. Under the Deposit to drop-down, select Undeposited funds
  3. Ensure that the correct invoice is selected. Then, Save and close.
  4. From the left panel, click +New and then Bank deposit.
  5. Select the Account you want to put the money into.
  6. Check the payment and under the Add funds to this deposit section, select the expense account you use in tracking bank charges.
  7. Enter the amount fee as negative.
  8. Review the total deposit and then Save and close.

You can check out these links for more details in handling customer transactions:

 

Let me know if you have other questions. Take care and have a great day!

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