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C
chloe-lim-kydong
October 14, 2024
Question

Hi QuickBooks Team, could you explain why my invoice is listed as a liability and why the amount in the purchase list shows as negative.

  • October 14, 2024
  • 1 reply
  • 0 views
Do you have any methods for generating a more accurate purchase list?

1 reply

R
RogelioL
October 14, 2024

Thank you for reaching out to us, Chloe. I'd be happy to help clarify why your invoice is showing as a liability and why the purchase list displays a negative amount.

 

In QuickBooks, an invoice could appear as a liability if the income account for the items on the invoice has been mistakenly assigned to a liability account. This is common if the account selected isn't set up properly in your Chart of Accounts.

 

To ensure that invoices are categorized correctly:

  1. Double-check the income account assigned to the items on the invoice.
  2. Ensure that the items are linked to the correct income accounts under your Chart of Accounts.

 

Regarding the negative amounts on your purchase list, if what you’re referring to as “invoices” are vendor bills, this is due to them being posted to a liability account. In your purchases report, vendor bills that are categorized under liability accounts will appear negative because they decrease your liabilities.

 

To generate a more accurate purchase report:

  1. Ensure vendor bills are assigned to appropriate expense or COGS accounts, rather than liability accounts.
  2. If the bills need to remain in the liability accounts, you may want to run custom reports that focus on expense accounts to get a more accurate view of your purchases.

 

If you're unsure how to make these changes or need help reviewing your Chart of Accounts setup, you may want to consult with an accountant.

 

Moreover, you may want to check out this article to learn how to get the most out of your financial reports: Customise reports in QuickBooks Online.

 

Let me know if you need any further clarification, and I’d be happy to assist you further.

C
chloe-lim-kydongAuthor
October 21, 2024

Hi There, 

 

Is there a way to prevent the purchase listing from showing negative amounts if my bill is posted to a liability account?

 

Thanks!

L
LollyNino_C
October 21, 2024

Hi Chloe,

 

Thanks for reaching out about the negative amounts in your purchase listings. Let’s clarify how this works in QuickBooks and explore some solutions together!

 

In QuickBooks, invoices should be recorded in the Accounts Receivable account, which is an asset account, not a liability. If your invoices are appearing as liabilities, it might be due to how the accounts are set up or categorized.

 

When you receive a bill from a vendor, it goes into Accounts Payable, which is a liability. If the bill remains unpaid, it shows as an outstanding liability. Negative amounts can occur if a bill is recorded without a corresponding payment.

 

To ensure correct categorization, please check the transaction type. If any invoices were mistakenly recorded in a liability account, you can edit them by going to the invoice, selecting Accounts Receivable, saving the changes, and then verifying that everything reflects correctly.

 

For the negative amounts in your purchase list, check for any unpaid bills related to those invoices:

 

  1. Navigate to Reports.
  2. Search for Accounts Payable to find any unprocessed or outstanding bills.

 

If the negative amounts relate to inventory, follow these steps to review:

 

  1. Go to Reports.
  2. Open the Inventory Valuation Detail report.
  3. Select All Dates from the report period dropdown and click Run report.

 

Look for any products with negative quantities and make sure that purchases are recorded before sales. Also, confirm that all payments for recorded bills are applied in the Expenses section.

 

For further troubleshooting, check out this article: Fix negative inventory issues in QuickBooks Online.

 

I’ve also included a link for more information on managing purchase orders: Create and send purchase orders in QuickBooks Online.

 

We're always available if you need additional assistance managing invoices in QuickBooks Online. You can click the Reply button and tag us in the Community.

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