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C
ComTrk
September 27, 2022
Question

How to invoice a customer for a vehicle who traded in their vehicle as payment, that we will keep in inventory to sell later?

  • September 27, 2022
  • 1 reply
  • 0 views

Customer is buying a truck and traded in their truck as full payment. We are taking that trade in and are going to resell it so I need it in inventory. I cannot make our customer also our vendor to apply any credit. So how do I properly log this?

1 reply

R
RoseJillB
September 27, 2022

Welcome to the Community, @ComTrk.

 

I can help you enter your trade-in transaction in QuickBooks Desktop (QBDT).

 

We can create a credit memo and apply this to your customer to record the transaction. 

 

Beforehand, let’s add the truck that your client used to pay the invoice as an item. Let me guide you on how:

 

  1. Go to the List menu, and select Item List.
  2. Click the Item dropdown and select New.
  3. Select the type of item and fill out the item fields. Then, Save.

 

Once done, create a customer credit memo that posts the amount of the invoice to the vehicle fixed asset account. If you don’t have the account yet where you can add the transaction, refer to this article to create one: Add, edit, or delete accounts in QuickBooks Desktop

 

To create and apply the credit memo refer to the steps below:

 

  1. Go to the Customer menu, and select Create Credit Memos/Refunds.
  2. Select your customer from the Customer:Job dropdown.
  3. Enter the items you’re giving credit for. Then, select Save & Close.
  4. In the Available Credit window, choose Apply to an invoice and select the open invoice for the truck.
  5. Lastly, click OK.

 

Since you will be selling the item back, please take note that when you sell inventory items on invoices and sales receipts, that's the time it affects the Cost of Goods Sold (COGS).

 

I also recommend you consult your accountant to ensure that this will be accounted for properly.

 

Let me know if you have more concerns about invoicing customers. I’ll get back as soon as I can. Stay safe!

C
ComTrkAuthor
September 29, 2022

I believe so. I did this already before writing the question in the community forum, however I was thinking I still needed a journal entry since I was original told in training I always needed a bill for an item. If I need a bill then there must be a vendor. That's where my thought process was getting confused on how to apply the vender and the customer to the same credit and payment. 

Candice C
Candice C
September 29, 2022

Good afternoon, @ComTrk. 

 

Thanks for reaching back out with your concern about a customer's vehicle. I can point you in the right direction to ensure this is how you should properly record this situation. 

 

The best route would be to speak with your accountant on these details. They'll be able to give you the best accounting advice for your business. 

 

If you don't have an accountant, find one near you using this link. 

 

Don't forget to keep us updated on how the conversation goes and what your accountant comes up with. We're always here to have your back. Take care! 

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