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batvalil
January 28, 2019
Question

Cleaning up old A/R from prior "accountant"

  • January 28, 2019
  • 2 replies
  • 0 views

I have a new client.  The A/R summary shows substantial transactions creating credit balances in A/R from 2003-2005.  I have close to $100k in credit balances.  In looking at what the prior "accountant" did I can determine the following -  A journal would be booked (instead of creating an invoice) debiting A/R and crediting the income account.  The customer name was noted in the memo line.  When the payment was received a customer account was created  and the check was received against the customer account; however, there were no invoices to post these checks against because the invoice was created with a journal entry.  I now have hundreds of credit balances for customers whose payments were received against their account but they had no corresponding invoice to post these payments against because a journal entry was used to create the invoice.  Any suggestions on how I can clean this up?

2 replies

IamjuViel
IamjuViel
January 28, 2019

Glad to see you here, @batvalil.

 

I'm here to help walk you through clearing out your customer's old balance in the system. Let's get started!

 

To start with, let's create a general journal entry to write off your accounts receivables. Here's how:

  1. Create the appropriate journal entry.
    1. Go to the Company menu.
    2. Choose Make General Journal Entries.
    3. In the Make General Journal Entries window, change the date and fill in the entry number if necessary.
      1. Go to the Account field.
      2. Select Accounts Receivable.
      3. Enter the amount under Debit column.
      4. Choose a Customer Name from the drop down list.
      5. In the next line, select the offset account.
      6. Type in the amount under Credit column.
  2. Apply the General Journal Entry to the Existing Credit.
    1. Click the Customers.
    2. Choose Receive Payments.
    3. Enter the name of the customer in Received From field.
    4. Select the invoice and choose Discounts & Credits.
    5. Under Credits tab, select the available credit.
    6. Click Done.
    7. Select Save & Close.

That should do it!

 

If you need further help with the steps above, I'd recommend contacting our Customer Care Team. A specialist will be able to access your account in a secured environment and further assist you via remote access session.

 

Here's how to contact us:

  1. Visit: https://help.quickbooks.intuit.com/en_US/contact.
  2. Choose your QuickBooks Product.
  3. Select your QuickBooks Version.
  4. On the Contact Us page, click a topic.
  5. Click on the Get Phone Number button to see the support number.

Feel free to drop a comment below if you have other questions about writing off your customer's balance. I'm always here to lend a hand.

    qbteachmt
    qbteachmt
    January 28, 2019

    You don't create More JE.

     

    @IamjuViel

     

    Please Learn from the input here. JE should be Avoided for anything where Names are involved.

     

    @batvalil

     

    They are not used for AR, AP, you cannot list Items, they are not going to show as sales or allow for sales taxes, not for QB payroll. Worse, you just bypassed Cash vs Accrual Basis reporting. Your income tax reporting in those prior years might be horribly wrong. Let's review.

     

    "I have close to $100k in credit balances."

     

    This is where Cash vs Accrual is the issue; Negative AR does not show as Income for the financial reporting, and if some of that is Sales tax liability, that isn't getting any details about the funds from a corresponding Invoice details, at all.

     

    "In looking at what the prior "accountant" did I can determine the following -  A journal would be booked (instead of creating an invoice) debiting A/R and crediting the income account.  The customer name was noted in the memo line."

     

    QB requires a Name in the Customer Field, if they posted to "AR"; otherwise, you would use your own Generic Other Current Asset.

     

    "When the payment was received a customer account was created  and the check was received against the customer account; however, there were no invoices to post these checks against because the invoice was created with a journal entry."

     

    You would be able to Apply them to each other if there was a Name in the Income JE for the AR line. If there is not a name, they didn't use "real AR" and that means, you can create an Other Charge Type item linked to that Other Current Asset account and put that on an Invoice for the customer now, dated historically for that JE. Apply the Available Credit to the Payment. Now you are Clearing that Other Current Asset Balance and applying the Negative AR from the checks.

      E
      EmaicaD
      March 25, 2025

      I appreciate your efforts in reaching us here in the Community and to the Intuit live support team, NumbersNC. The best option to make is to manually received the payment of each transaction to appear on the debit side of Accounts Receivable. I'll outline the steps below.

       

      The option to batch apply payments that appeared only on the credit side of your Accounts Receivable is currently unavailable in QuickBooks Desktop that's why you need to do it manually.

       

      Here's how:

       

      1. Go to the Customers menu, then choose Receive payment.
      2. Select the customer's name in the Received from dropdown.
      3. Enter the Amount and also the necessary details that need to be filled out.
      4. Click Save and Close. By default, it's only deposited in the Undeposited funds.

       

      In QuickBooks Desktop (QBDT), batch or bulk-applying payments aren't currently available due to the need for precise accounting. This could prevents mistakes in the books and makes sure every transaction is tracked properly. It helps keep detailed and accurate financial records, which is essential for managing money well.

       

      You can refer to this article to manually receive the payments of each transaction: Receive payments in QBDT.

       

      After you have received each payment, you can now make a bank deposit in QuickBooks Desktop.

       

      We need to manually apply payments to ensure accuracy in your accounts even it could take much time and effort to finish. If you need further assistance, feel free to reach out anytime.

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