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KJS
December 19, 2024
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Trying to transfer credit from one customer to another - QB solution not working

  • December 19, 2024
  • 2 replies
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Hi everyone,

 

I am trying to transfer a credit issued to one customer to another customer's outstanding balance.  I found a really clear explanation of how to do this on QB as per the below link.  My issue is it is not working for me.

 

https://quickbooks.intuit.com/learn-support/en-us/help-article/manage-customers/transfer-credit-one-customer-another/L4vT5bz8K_US_en_US

 

When I set up the 2nd line in the journal entry, I follow the instruction to "On the second line item, select Accounts Receivable"

 

However when I do that & set up the 2nd part of the journal entry I get an error message saying I cannot use AR twice on the journal entry.

 

That is exactly what the QB explanation says to do.  What am I doing wrong?  How do I fix this?  I need to move the credit from one customer to pay another customer's outstanding invoice.  Thank you for any help anyone can offer in advance!

 

 

 

Best answer by Rainflurry

@KJS 

 

You can obviously ignore the response from @MirriamM .  It's as though they didn't even read your question and it does nothing to address your issue.

 

In QB Desktop, you can't use A/R on two lines of a single journal entry (JE) so you'll need to use a temporary account and two JEs.  First, set up a bank account in QB called Clearing Account.  Then, make a JE that debits A/R for the customer that currently has the credit (customer 1)and credit the Clearing Account for the amount of the credit.  Then, make another JE that debits the Clearing Account and credits A/R for the customer (customer 2) that you want to move the credit to.  Finally, you need to clear the A/R debit and credit for customer 1 so go to Customers > Receive payment and apply the credit to the "invoice" created by the A/R debit.  Finally, you should have the credit available to use for customer 2.  You can mark the bank Clearing Account as inactive if you don't want to see it on your reports.  Hope that helps.    

 

 

2 replies

M
MirriamM
December 19, 2024

Transferring credit between customers is essential for managing your business finances effectively, KJS. It keeps everything balanced and ensures that your operations run smoothly. Let's work together to make sure your credits are accurately transferred, so you can maintain seamless account management.

 

It appears the article you referenced addresses transferring credit in QuickBooks Online (QBO), which differs from your situation with QuickBooks Desktop. Here's the correct procedure for transferring customer credit from one job to another in QuickBooks Desktop:

 

  1. Locate and open the invoice you want to transfer the credit to.
  2. Choose Apply Credits under the available credits.
  3. Select the credits you want to transfer.
  4. Click Done.
  5. Select Yes to complete the transfer.

 

Please note, that you need user access to the Chart of Accounts to perform this action. Additionally, transferring credits is irreversible, so it's wise to consult with your accountant before proceeding.

 

If you prefer, you can manually transfer credit between different jobs or customers. For detailed instructions, please refer to the article: Transfer customer credit from one job to another in QuickBooks Desktop.

 

If you're experiencing issues with your accounts receivable balances in the future, check out this article for step-by-step guidance: Resolve AR or AP on the cash basis Balance Sheet with journal entries.

 

Our team is always here to offer support and guidance. Should you have any questions or need further assistance with transferring credits, please feel free to reach out.

Rainflurry
RainflurryAnswer
December 20, 2024

@KJS 

 

You can obviously ignore the response from @MirriamM .  It's as though they didn't even read your question and it does nothing to address your issue.

 

In QB Desktop, you can't use A/R on two lines of a single journal entry (JE) so you'll need to use a temporary account and two JEs.  First, set up a bank account in QB called Clearing Account.  Then, make a JE that debits A/R for the customer that currently has the credit (customer 1)and credit the Clearing Account for the amount of the credit.  Then, make another JE that debits the Clearing Account and credits A/R for the customer (customer 2) that you want to move the credit to.  Finally, you need to clear the A/R debit and credit for customer 1 so go to Customers > Receive payment and apply the credit to the "invoice" created by the A/R debit.  Finally, you should have the credit available to use for customer 2.  You can mark the bank Clearing Account as inactive if you don't want to see it on your reports.  Hope that helps.    

 

 

K
KJSAuthor
December 20, 2024

Thank you Rainflurry for this detailed solution.  Looks like that may work as I understand the logic of what you are suggesting.  I agree MirriamM did not provide a solution for my issue & I was about to reply explaining that was of no help at all but you kindly beat me to it with your solution.  Thanks again for taking the time to help out a fellow QB user over this busy time for businesses.  Happy Holidays!

    K
    KJSAuthor
    December 27, 2024

    I just managed to implement this solution kindly provided by Rainflurry & it worked perfectly.  This is the solution.

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