Receive Payments in QuickBooks
We receive many queries from readers about the correct way to apply customer payments that pay off invoices for multiple jobs in QuickBooks. Of course, the term “correct” means different things to different people.
At cpa911.com, we define “correct” as the solution that makes it easy to track what you did, and makes reports accurate and easy to understand. Therefore, the correct way to apply customer payments for multiple jobs is to select one job at a time in the QuickBooks Receive Payments window.
However, when we respond with these instructions we often get another message from those readers, telling us that others (especially the self-proclaimed experts in the QuickBooks Community Forums) advise receiving the payment by selecting the customer in the Receive Payments window and checking off the individual jobs for which the customer sent the payment.
The results of each method are different, and we care about those differences. To illustrate, we’ll go over both methods for a QuickBooks customer that has two open invoices, and each invoice is for a separate job. In this example, we’re using the customer named AAA.
Enter a Separate Transaction for Each Job/Invoice
This customer sent a check for $405.00, which is the total of the two invoices. To apply the payment to the individual jobs/invoices use the following steps:
- Choose Customers | Receive Payments.
- In the Received From field, select one of the jobs (do not select the customer).
- Fill in the amount of the check that is earmarked for this job’s invoice.
- Enter the check number.
- Select the invoice.
6. Click Save & New.
7. In the Received From field, select another job with an invoice covered by this payment and repeat these steps.
Each transaction uses the same check number, of course. Make sure you send payments to Undeposited Funds, not to a bank account. When you select the multiple payments in the QuickBooks Make Deposit window, the deposit total is equal to the amount of the check.
If you need to check this customer’s status (perhaps the customer has called to discuss his account), here’s what you’ll find in QuickBooks:
- Selecting a job in the QuickBooks customer center displays the invoices, payments, and current balance for that job.
- When you create a QuickReport on the job, the invoices and payments are displayed.
- When you create a QuickReport on the customer, the invoices and payments are linked to the appropriate jobs.
- When you create an A/R Aging Report, the customer’s history is linked to the appropriate jobs.
Enter a Single Transaction for All Jobs/Invoices
To enter a single QuickBooks transaction for payment of multiple invoices linked to separate job, use the following steps:
- Select the customer instead of a job in the Receive Payments window (QuickBooks displays all the open invoices for all jobs).
- Enter the amount of the check.
- Enter the check number.
- Select all the invoices paid by this check.
Save the transaction and use the QuickBooks Make Deposits window to move the payment to the bank account.
If you need to check this customer’s status (perhaps the customer has called to discuss his account), you’ll find the following:
- Selecting a job in the QuickBooks customer center displays the invoices, but not the payments.
- When you create a QuickReport on a job, only the invoices are displayed.
- When you create a QuickReport on the customer, the invoices and payments are not linked to the appropriate jobs; instead, the payments are linked to a job named “Other”.
You may have saved thirty seconds of time when you created the payment transaction, but your accounting records for jobs aren’t accurate. This is NOT the way to track customer activity in QuickBooks.