Invoice Overpayment

You enter the amount you got. You check off the invoice(s) it pays. If there is leftover (overpayment) QB says "Do you want to create a credit memo." You do, but you don't need to print it.

Next time they short pay, you enter the amount you got. QB has a notice on the entry screen that there are credits outstanding. You highlight the invoice and hit the credit button. It applies the credit and you hit okay. Now you check off the invoice and the world is wonderful.

It's all in the help.

Thanks for the feedback. I read the help info, but got lost in it. I understand what you're saying, but on the next invoice, I don't want to bill them for the full amount, only for the amount they actually owe after the credit. Otherwise, I'm going to be getting a call saying "I already paid you.....". If I set up the new invoice for what they're actually going to be paying me, there will be nothing to apply the credit to. Sorry, I'm still confused. Accounting ain't my thing. Suggestions? Thanks, Rob.

No your invoice should be for the full amount so that your income is correct. Just mark on the bill that the balance due is $xx so that there is no confusion. Then when they pay that amount follow your directions to apply the outstanding credit plus their payment to clear the balance.

Rob, Don't get stuck by thinking this is all 'accounting'. The label for what you are doing is immaterial. Think of what you want to do - QB will allow several options for doing it.

So, let's use real numbers and look at your situation. You billed your customer, say, $400 for the quarter, and your customer accidentally paid $425. They don't want a refund check, but want the credit to be on the next bill.

If you were doing this 'by hand' you would deposit the $425, mark last quarter's invoice as paid, and keep the credit on file. Next quarter, you would send an invoice to the customer, noting the amount of the invoice, and subtracting the credit. The steps are: Initial payment gets recorded. Current invoice marked paid. Credit on file. New invoice created. Credit subtracted.

Here's how to do that in QB In the 'Receive Payments' window enter the amount of the check you received and select the invoice for this quarter. QB will give you a warning that you have not applied all available payments to unpaid invoices. Click ok. Now you have marked the current invoice paid and have created a credit on the customer account. Next quarter, you create the new invoice and, before you print a copy to the customer, you apply the credit to the invoice. In QB, that means you go to the 'Receive Payments' window, select the new invoice you created, and use the 'apply credits' button to subtract the credit from the invoice.

See? No accounting lingo necessary.

The credit will remain on file until you apply it to an invoice. It *IS* a manual procedure and you *WILL* have to remember - fat chance or no. However, the credit should be applied before the customer sees the invoice.

Remember, that is what the company to do list is all about.

OK, the light bulb finally blinked. Applying the credit BEFORE I print the invoice makes it all work in my head. Thanks very much for everybody's patience and help. Rob

You still want to bill them the full amount next month. Their overpayment will automatically create a credit balance on their account when you record the payment. Next month you invoice as usual, and Quickbooks will prompt you that there are credits on that account, and ask if you want them applied. You just answer "yes". So your $500 invoice will show the $25 overpayment applied, and a balance due of $475, for example.

You still want to bill them the full amount next month. Their overpayment will automatically create a credit balance on their account when you record the payment. Next month you invoice as usual, and Quickbooks will prompt you that there are credits on that account, and ask if you want them applied. You just answer "yes". So your $500 invoice will show the $25 overpayment applied, and a balance due of $475, for example.