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Agencypartner1
October 25, 2022
Question

QBO categorizing bank deposit related to duplicate payment of customer invoice

  • October 25, 2022
  • 2 replies
  • 0 views

What's the proper way to add/match the bank deposit for a duplicate payment on a customer invoice in the bank feed?  I already created the credit memo so the 2nd payment can be applied to future invoices (rather than processing it as a refund).  I just don't know how to go about categorizing/matching the payment in the bank feed.  Is it as simple as categorizing the bank deposit to accounts receivable so it doesn't get recognize as revenue until it's applied to future invoices?  Or is there a better way to handle it (such as matching it to the credit memo)?  If so, how do I go about doing so?

2 replies

G
GebelAlainaM
October 25, 2022

Thank you for taking the time to post here in the Community space, @Agencypartner1. I'd be glad to share additional information about your duplicate payment of a customer invoice.

We're unable to match a bank transaction to a credit memo. Thus, I agree with you that it is as simple as categorizing the bank deposit to accounts receivable so it doesn't get recognized as revenue until the credit memo is applied to future invoices. I'll show you how to manually apply the credit memo to an invoice.

Here's how:
 

  1. Click the + New button, then choose the Receive payment option.
  2. From the Customer dropdown, select the customer.
  3. In the Outstanding Transactions section, select the open invoice you want to apply the credit memo to, then select the credit memos you want to apply.
  4. For the open invoice in the Payment column, enter how much of the credit you want to apply.
  5. Leave the Payment method, Reference no, Deposit to, and Amount received fields blank.
  6. Fill out the rest of the form, including the Payment date.
  7. Ensure that the total is correct after applying the credit memo and that all other information is correct.
  8. Then click Save and close.
     

For references, please see this article: Create and apply credit memos or delayed credits in QuickBooks Online.

Additionally, you may also want to check out the following article for future resources:
 

Feel free to tap the Reply button if you need further help in managing your bank transactions. I'll be around. Have a good one!

P
Pam - GCCA
July 24, 2023

I have the same issue.  I created a Delayed Credit to apply to future invoices. I want to record the deposited funds, but the customer has no open invoices.  How do I record the funds, but retain a credit for a future invoice?  Will creating a sales receipt keep the credit open for the customer?

KlentB
KlentB
July 24, 2023

I've got you covered, Pam - GCCA.

 

Creating a sales receipt in QuickBooks Online will keep the credit open for future use. However, please keep in mind that this sales form is mainly used when a customer pays for services or products immediately.

 

To mirror the transaction that occurred to your real-life bank account, you'll want to consider entering it as a deposit. I'll walk you through the process:

 

  1. Click the + New button.
  2. Choose Bank Deposit.
  3. Set the appropriate account and deposit date.
  4. Go to the Add funds to this deposit section.
  5. Enter the customer name, category, payment method, description, and amount.
  6. Add a memo as needed, then hit Save and close.

 

Additionally, here are some articles that you can read to be guided in handling credit memos, delayed credits, and customer overpayments:

 

 

Remember, I'm just a click away if you need a hand in accomplishing your other tasks in the program. Wishing you a productive week ahead!

H
Hansenview
July 25, 2023

Handling a duplicate payment on a customer invoice in the bank feed requires careful categorization and matching to ensure accurate accounting. The steps to resolve this situation might vary slightly depending on the accounting software you are using, but I'll provide a general guide on how to handle it:

1. Record the Credit Memo:  MyLabCorp
- As you mentioned, you've already created a credit memo to offset the duplicate payment. Make sure the credit memo is correctly associated with the customer and the original invoice.

2. Match the Bank Deposit to the Credit Memo (Recommended):
- Ideally, you should match the bank deposit directly to the credit memo to indicate that the duplicate payment has been applied to the credit. This will avoid recognizing it as revenue until it's applied to future invoices.
- In your accounting software's bank feed or reconciliation tool, you should see the bank deposit representing the duplicate payment.
- Look for an option to "Match" or "Find a match" and select the credit memo you created in step 1. By doing this, the bank deposit will be reconciled with the credit memo, and it won't affect your revenue.

3. If Matching is Not Possible:
- In some accounting software, you might not have a direct "Match" feature. In such cases, you can manually categorize the bank deposit to an appropriate account to reflect the duplicate payment correctly.
- Categorize the bank deposit to an account that represents a "clearing" or "undeposited funds" account, which acts as a holding account for funds that haven't been applied to specific invoices yet. This way, the money will be accounted for but not recognized as revenue until it's correctly applied.

4. Apply the Credit Memo to Future Invoices:
- When you create future invoices for the customer, apply the credit memo you created in step 1 to those invoices. This will reduce the amount due on the new invoices by the credit amount, effectively using the duplicate payment against future purchases.

5. Regular Reconciliation:
- Regularly reconcile your accounts to ensure that all transactions, including the credit memo and the duplicate payment, are accurately recorded in your accounting software.

It's important to consult with your accountant or bookkeeper to ensure that you are handling this situation in a way that aligns with your specific accounting practices and the software you are using. Additionally, if you're uncertain about any of the steps or terminology, it's best to seek professional advice to avoid any accounting discrepancies.

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