Writing Off Short Payments or Bad Debt




“Quicklet” - A Podcast for QuickBooks Pro, Premier, Enterprise Solutions & Point of Sale users featuring helpful information, tips, tricks and suggestions for bookkeepers, business owners, and consultants. Got a QuickBooks Mess? Ask The QuickBooks Gal!
Ask the QuickBooksGal!
Hi, I'm Jayne Miller, The QuickBooks Gal. Welcome to another in our series of “Quicklets” – informational podcasts about QuickBooks and related bookkeeping topics.

The other day a client called to ask me how she could write off some small short payments on customer accounts. Additionally, she had a couple of account that she wanted to write off to bad debt at the end of 2007. That is really simple if you use the Credits & Discounts button inside the window where you apply payments on accounts.

Here's how to do this:

1 - Open up the Receive Payments window and bring up the customer account you wish to affect. Then, date the transaction for the end of the accounting period you wish to affect. Note: I do this so I can easily find any adjustments I make...I always date my adjustments the last day of the month/year that they affect.


2 - Make sure that you do not enter an amount in the Amount section.

3 - Attempt to place a check mark next to the invoice in the ledger portion of the window that you wish to adjust. You will get an error message telling you that you don't have an amount designated...just tell the message OK. Note: in QuickBooks 2008, once you click on the invoice, the amount automatically fills in above. If this happens, blank out the amount window.


4 - Press the Discounts & Credits button in the lower portion of the window to bring up another window where you can select the amount to discount and the account to which you wish to assign the "write-of" amount.

5 - Enter the amount you wish to write off and then select the account. I use Customer Discounts when a customer underpays an invoice an I have chosen to write it off....generally I write off anything under $5.00. If you are writing off an noncollectable debt, then use Bad Debt Expense as your category.

Of course, you can always use a General Journal entry to accomplish this, however this method not only is simpler, it also reconciles the open balance on the invoice(s) you are writing off.

I hope you find this useful. If you need help or have questions, send me an email at jayne@quickbooksgal.com.

Last week, I did a podcast about the new I-9 forms that replaced the old forms on December 26, 2007. I hope you are all using those. Today, a lady came into my office looking for those forms...someone told her that she should come here for them. If you are looking for the new form, visit my blog for a link where you can download the form and the instructions or check out my podcast at blog.quickbooksgal.com.

I would like to remind everyone to back up. We're wrapping up 2007 bookkeeping and processing lots of end of year documents such as W-2, 1099, and Quarterly & Annual reports. Let's make sure we are backing up and protecting our work! If you are using an older version of QuickBooks (1999-2005) it's time to think about upgrading to QuickBooks 2008. This is especially important if you are processing Payroll or accepting Credit Cards through QuickBooks. Check out the money saving offers on my blog or visit quickbooksgal.com to shop in our online store.





Well, that’s it for now. I appreciate your time and hope you will join us again next time for another in our Quicklet© series. If there are topics you would like me to cover, send me an email at jayne@quickbooksgal.com. I welcome your ideas, questions, and comments.

Got a QuickBooks Mess? Call The QuickBooks Gal!

I’m Jayne Miller, The QuickBooks Gal. Thanks for listening.

Jayne Miller, is the owner of Custom Business Solutions, is a consulting firm in Reno, NV that specializes in providing bookkeeping and software support. © 2007

Comments

Post a Comment

Popular posts from this blog

How to "Un" Apply Credits In QuickBooks

Image
Got a QuickBooks Mess? Call The QuickBooks Gal! Welcome to the QuickBooks Minute. I’m Jayne Miller, the QuickBooks Gal Recently, one of our Reno QuickBooks customers asked about "unapplying" credits in QuickBooks. While there are nicely labeled apply credits buttons, there are none marked unapply. This is the case for both customers (invoicing) and vendors (paying bills). So here is how it is done: For customers, it is a fairly easy process. Go to the invoice to which the credit was applied. Then click on the "Apply Credits" button. In the lower half of the new window that pops up is a list of Previously Applied Credits. Simply find the one, or ones you wish to unapply and click on the check mark next to it to make the check mark disappear. The credit will no longer be applied or tied to that invoice. For Vendors, i.e. bill payments, it is not as clean and simple. The only way to unapply a credit in such a case is to Delete the credit. You can then
Read more

QuickBooks Password Protection

QuickBooks now requires your employees to enter a password to view their pay stubs when you e-mail them. QuickBooks generates the passwords automatically; each password consists of the first four letters of the employee's last name followed by the last four digits of their Social Security number. Examples Name:                            SSN:                         Pay Stub Password: Ben Narramore              855-56-4545             narr4545 Deb D'Spain                  782-34-3419             dspa3419 Jimmy Wu                     903-88-7465             wu7465 Note that all characters must be entered in lowercase and punctuation characters are not included in the password. When a last name has fewer than four characters, the whole last name is used (like in wu above) but no additional characters are added. You will need to inform each employee of this new password requirement
Read more

Employee Salary/Wage Rate Report

Image
Welcome to another QuickBooks Gal Minute. I'm Jayne Miller, The QuickBooks Gal. Do you need to produce a report by Employee that lists only Employee Name and Wage Rate? In QuickBooks that's easy! Here's how to modify a standard report to include the data you want to report. In the top tool bar, select Reports Select Employees & Payroll Select Employee Contact List from the drop-down list Once inside the report, select Modify Report in the report tool bar In the "column" section, remove the check marks from the information choices you don't need. In the "column" section, place a check mark next to "Employee" In the "column" section, place a check mark next to "Earnings/1 Rate" This will customize the report to include only employee names & salary/wage amounts. As you explore the Modify window, you will find that there are many useful information options you can use to create really great custom reports...by the
Read more