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M
mac2it
January 6, 2023
Question

Vendor early payment discount

  • January 6, 2023
  • 1 reply
  • 0 views

We conveted from MAC Desktop to QBO and need to apply a payment to a vendor bill that has a discount. The vendor is already setup with a 2% purchase discount and this always worked fine in our desktop verison but when we are marking the payment (done outside qb directly with vendor) we don't see a way to apply the autmatic early payment discount or an additional flat rate discount to the same bill (e.g. $20).

    1 reply

    L
    LollyNino_C
    January 6, 2023

    Hello there, @mac2it. Thank you for sharing your concerns here with us in the Community. I'm here to provide information about Vendor early payment discounts. 

     

    At this moment, the option to automatically calculate early pay discounts on vendor bills is unavailable in QuickBooks Online (QBO). What you can do is create a vendor credit transaction, based on the discount amount. You can then apply this vendor credit to the bill payment. 

     

    Let me show you how to create the vendor credit:

    1. Go to the + New menu.
    2. Select Vendor credit.
    3. Choose the correct vendor under the Vendor drop-down menu.
    4. Under the Category details section, use an income account under the Category column. (We do this instead of an expense account since it's for a discount.)
    5. Fill up the rest of the form as necessary.
    6. When done, click Save and close.

    Once that's taken care of, you can proceed with recording the bill payment. Here's how;

    1. Highlight the Expenses tab.
    2. Select Vendors.
    3. Search for the vendor in question, then click to open their respective vendor page.
    4. On the vendor page, look for the specific bill. Tap to open it.
    5. Press the Mark as a paid button.
    6. On the next page that appears, scroll down to check if the vendor credit created earlier is included.
    7. Hit Save and close when finished.

    For additional information, you can click this article: Enter and pay bills. This also provides steps on how you can pay your bills through checks and how you can apply partial credits to multiple bills.

     

    Please check this article to see steps on how you can enter credit depending on how you record your purchases: Enter a credit from a vendor.

     

    You can also refer to this article on how to run a report that will reflect all payments made to vendors: Run a report with vendor totals.

     

    If you have additional questions about finding an app that can help you automatically calculate early payment discounts in QBO, feel free to add a reply below. I'd be glad to assist you. Keep safe. 

    M
    MotherByrd
    February 5, 2024

    Why is the world, should Users have to PAY for a thirdparty App to correctly calculate Vendor Early Pay Discounts? This is available in every other entry-level bookkeeping software, more importantly this was available in QBW for decades! 

      J
      JamaicaA
      February 5, 2024

      Hi there, MotherByrd.

       

      I understand the need to calculate discounts for early payments of your vendors. However, this feature is currently unavailable. What we can do is submit this request to our developers for now.

       

      You may consider sharing this idea with our product developers. They can consider this for future updates depending on the number of requests. I'll show you how:

       

      1. Go to the Gear icon.
      2. Choose Feedback.
      3. Enter your product suggestion, then click Next.

       

      You can visit our website or blog to track your requests and recent developments.

       

      Furthermore, paying for a third-party app may not always be convenient. In this case, create a discount item, then add it as a line item in the original bill (negative charge) to adjust the amount. To proceed, follow the steps below:

       

      1. Go to the Gear icon, then select Products and Services.
      2. Press New and click Non-inventory or Service type, then fill in the fields.
      3. Enter Discount in the Name field, then add the amount as negative in the Sales price/rate field.
      4. From the Income account drop-down, choose the appropriate account.
      5. Ensure the Is Taxable is unchecked, then tap on Save and close.

       

      You also have the option to create a vendor credit and apply it to the bill payment. Please see this article for more details: Manage Vendor Credits.

       

      I'm always here to listen if you have other vendor discounts and bill payment concerns. Feel free to post again. Stay safe!

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