Welcome to the Community, @Kathy161.
Let me share how QuickBooks Online (QBO) handles existing revenue recognition invoices and provide you with the steps.
You can close or adjust an existing schedule and issue a credit memo or a refund receipt. For instance, let’s say you’ve already recognized US $200.00 for the service, however, you want to issue a complete refund for US $1200.00.
Here's how:
- Go to Sales, then Invoices
- .Open an existing invoice.
- Select the View Revenue Recognition link.
- In the Revenue Recognition panel, select Edit.
- In the Schedule section, do one of the following actions:
- Recognize now: You can stop all future revenue recognition entries for the item by recognizing all the remaining unrecognized amounts in the current open month. In other words, post an amount to the entry so that the income account matches the total price of the item to close out a schedule. Remember, in this example, you've already recognized US $200.00 for the service, so you need to post US $1,000. That way, the income account will total US $1200.00. You also need to verify, in this example, that all future entries are zero amounts. When you issue a credit memo for US $1200, all the income is reversed. When you issue a credit memo of US $500, only US $500 of the income is reversed.
- Keep the schedule as it is.
- Customize the schedule for your needs.
- Select Apply.
- Create and issue a credit memo or a refund receipt.
Feel free to read this article for more info: Set up a revenue recognition schedule in QuickBooks Online Advanced.
On top of this, I recommend reaching out to an accountant to seek advice on the other approach for this kind of transaction.
If you want to personalize and add specific info to your sales forms, check out this article: Customize invoices, estimates, and sales receipts in QuickBooks Online.
Leave a comment below if you have additional Revenue Recognition concerns. I'll be willing to help you. Keep safe and have a good one.
