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sarah.walters
Level 1

How to write off a customer invoice?

We wrote off a customer invoice as we weren't going to receive payment for it. I issued a Credit note against the customer invoice and allocated it against our "Write off bad debt" expense account, however the original customer invoice is still showing up as open. Can someone please let me know what i have done incorrectly?

Solved
Best answer September 26, 2019

Best Answers
Rustler
Level 15

How to write off a customer invoice?

use receive payments, select the invoice and apply the credit

View solution in original post

3 Comments
Rustler
Level 15

How to write off a customer invoice?

use receive payments, select the invoice and apply the credit

View solution in original post

Code4Fire
Level 1

How to write off a customer invoice?

I too am trying this step, however, when after I've entered the credit and then go to "receive payment", the credit is not listed on the page for me to match them up.  I've followed all of the steps and tried numerous times.  Does the customer being a sub account have anything to do with it?

IamjuViel
QuickBooks Team

How to write off a customer invoice?

Hello there, @Code4Fire.

 

Let me guide you in writing off your customer's unpaid invoice.

 

First, you'd want to create a bad debt expense account and bad debt service item. Here's how:

  1. Go to the Accounting menu.
  2. Choose Chart of Accounts.
  3. Select New to create a new account.
  4. From the Account Type drop-down, select Expenses.
  5. Pick Bad debts in the Detail Type drop-down.
  6. Enter Bad debts in the Name field.
  7. Click Save and Close

Then, create an item for the bad debt.

  1. Choose the Gear icon.
  2. Pick Products and Services.
  3. Select New, then choose Service.
  4. Enter Bad debts from the Name field.
  5. From the Income account drop-down, select Bad debts.
  6. Click Save and Close.

Once completed, make sure to use the Bad Debt item in creating your credit memo. 

  1. Click the + New button.
  2. Select a Credit memo.
  3. Choose the customer from the drop-down.
  4. Select Bad debts in the Product/Service column.
  5. Enter the necessary information and the amount.
  6. Click Save and Close

Now, you can use it in paying your customer's outstanding invoice.

 

Always feel free to leave a comment below if you have other questions or concerns. I'm always here to help.