Unapplied cash payment income account

@lawrenanne1 

Unfortunately, you can't deactivate that account in QBO because it's a default account.  Your options are:

1) Eliminate the entries that hit that account.

2) When you run a P&L, select 'Customize' in the upper-right, then under 'Rows/Columns', under the 'Show non-zero or active only' pull-down, select 'Non-zero' under 'Show rows'.  That will remove the account from the P&L report.  

The Unapplied Cash Payment Income account in QuickBooks Online serves several important purposes, lawrenanne1. Allow me to join the thread and share additional details about this account.

In most cases, this account would automatically show up if:

• A customer makes a payment and is recorded before creating the associated sales form (invoice or sales receipt).
• Payments are entered without being matched to corresponding sales forms.

Similar to what's been previously shared by Rainflurry, the Unapplied Cash Payment Income is one of the accounts that can't be deactivated in QBO. These accounts are automatically generated during the initial setup process or when certain events occur, such as importing transactions from other accounting software.

Since the account has a zero balance, you can also follow the suggested workaround on how to remove the account when running reports. Here's an article for additional guidance about this: Remove Deleted Accounts From Reports In QuickBooks Online.

These resources will also provide a comprehensive understanding of how to work with the Unapplied Cash Payment Income account and similar special accounts in QuickBooks Online:

• Unapplied Cash Payment Income On Your Profit And Loss
• Manage Default And Special Accounts In Your QuickBooks Online Chart Of Accounts

Additionally, you may find these articles helpful when working with your client's chart of accounts and generating reports:

• Learn About The Chart Of Accounts In QuickBooks Online
• Customize Reports In QuickBooks Online Using Modern View

Don't hesitate to visit us again if you have any further questions while working in your client's account and performing any other bookkeeping tasks in QBO. We're always here to provide clarification and offer our help. 

This account currently has nothing in it, and I'm trying to prevent anything from going in it.  I know how to make it not show up, but I'm trying to prevent problems by eliminating the account altogether.  Why would QBO create an undeletable account that DOESN'T FOLLOW GAAP?  This is crazy.  I can see why it would be a default if someone selected "cash accounting" as the accounting method, it's bad accounting to recognize cash as income without an invoice in accrual accounting.  I am SO not impressed with QBO; desktop is a much better product. 

Just to add:  in your prepayment example, assigning the payment to income is simply wrong.  By accepting a payment before providing services AND invoicing means you have created a liability, and the prepayment should go into a liability account that you owe to the customer unless you provide a service AND an invoice.

@lawrenanne1 

I understand the balance is $0, but are you saying that there are no entries at all to that account?  Click on the $0.00 next to Unapplied Cash Payment Income on the P&L to see. If there are entries and reversals to that account, that's why it's showing on the accrual basis P&L.  

Agreed that it's not correct to see the Unapplied Cash Payment Income account on an accrual basis P&L in QB.  I've never seen it.  It must have something to do with the conversion from Sage.  The only reason that account should ever show up on an accrual basis P&L in QB is because a user posted a manual entry to that account.  QB does not post an entry to that account automatically on accrual basis but it will also not disregard a manual entry to that account on cash basis.  The only time QB automatically posts to that account is when a payment is received prior to the invoice date and only on cash basis.

Nada.  "This report does not contain any data" (for all dates).  It's very irritating.  You don't have this as a default account in your QBO setup, @Rainflurry?

@lawrenanne1 

Yes, that’s a default account in all QBO charts of accounts but I’ve never had it show up on an accrual basis P&L unless there was an intentional user created entry posting to it.  Strange that it shows without any entry.  Other than selecting the non-zero option when you run the report, I don’t know what else to suggest.  Sorry, wish I could be more help.