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parksbarbie
March 24, 2023
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Apply Prepaid deposit

  • March 24, 2023
  • 1 reply
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Last year my client prepaid a deposit for a hotel event that took place last week. We put the payment in an asset account -Deferred hotel fees. To move it this year to the expense account, I created a GJE credit Deferred asset acct and debit the Hotel expense account. This corrected the balance sheet but now the hotel expense is increasing the expense account and I need it to reduce it. How do I apply this as a payment towards the final hotel bill?

Best answer by Rainflurry

@parksbarbie 

 

In this case, IMO, the easiest way is to use a journal entry: debit Accounts Payable, credit Deferred Hotel Fees.  Select the hotel under 'Name' on the journal entry.  You now have a credit that can be applied to the hotel bill. 

1 reply

Rustler
Rustler
March 25, 2023

GJE does not work well in QB, and often the GJE is not included in reporting, best to not use them.

 

Create a service item called pre-paid deposit and link it to the deferred hotel fee asset account.

 

When you enter the bill for the stay, use the pre-paid item, qty is negative one, and the amount you pre-paid, the will will recalculate to the amount due, the pre-paid asset account will zero out.

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parksbarbieAuthor
March 27, 2023

If I add this to the bill it does not ask for service item- hotel bill that we owe is entered as category, description, amount, customer, class. Would I enter the defered category and -$xxx to zero out the deferred account and subtract our downpayment from the bill?

Rainflurry
RainflurryAnswer
March 27, 2023

@parksbarbie 

 

In this case, IMO, the easiest way is to use a journal entry: debit Accounts Payable, credit Deferred Hotel Fees.  Select the hotel under 'Name' on the journal entry.  You now have a credit that can be applied to the hotel bill. 

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