This screen is used to enter payments and credits applied to customer accounts. If you are entering an open credit to a customer account, you can enter it here and apply it to one or more open invoices later in the Sales Order browse with the [Apply Credit] button.
Do not enter returned merchandise here.
Payment received from vendors or other non-sales related transactions should be entered directly into the Check Register.
When transactions are entered, the customer balance is updated immediately, however, payments are not posted to the check register or general ledger until you press the [Post] button. Once payments are posted, they cannot be changed or deleted, but they can be voided. Voiding a payment reduces that checking deposit by the amount of the payment and re-opens any sales invoices that were credited.
Special Buttons
[Print] Prints reports or Bank Deposit Slips.
[Post] Post all new payments to the check register and the General Ledger Audit Trail as a single Bank Deposit.
Special Cases
Most payment transactions are straightforward: you apply open invoices to customer checks and the total of the check matches the amount you are owed. Of course, from time to time you will have to deal with situations where the amount received does not match the amount due, or an invoice must be closed without receiving full (or even partial) payment. Here are some procedures for handling these cases.
OVERPAYMENTS
If a customer sends too much money for an open invoice, there are three possible ways to handle this:
Method #1) Apply Payment To Another Invoice
Simply apply the overpayment to the oldest open invoice.
Method #2) Enter An Over-Payment
Enter the amount paid in the line item. You will be warned by a dialog box that you have entered more money than is due, but ignore this. During posting, the program will change the invoice status to ‘C’ indicating that it has a credit balance. You can then go to the invoice in Sales Orders and press the [Apply Credit] button to apply the open credit to another of this customers open invoices.
The advantage to this method is that you will know which invoice the overpayment was intended for. The disadvantage to this method is that the invoice will not be marked as paid in full after posting. Since it has a credit balance it will not appear on reports where you use the ‘PAID IN FULL’ filter, and it definitely will appear on customer statements.
Method #3) Create An Open Credit Memo (A bit trickier)
A. Enter the amount due for the original invoice in the line item.
B. Create a second line item. Select Open Credit as the payment type.
C. In the AMOUNT field, enter the difference between the amount due on the original invoice and the payment received.
D. Enter the original invoice # in the line item notes so that you can refer back to the invoice the customer intended payment to be applied.
During posting, a new credit memo will be created in Sales Orders, using the dummy invoice number you entered. The item with have a ‘C’ in the STATUS field, indicating it has a credit balance. Again, you can then go to Sales Orders and press the [Apply Credit] to apply this credit to other open items.
The advantages to this method are that the original invoice will be marked as CLOSED after posting. Also, the original invoice will appear on reports where you use the ‘ONLY CLOSED’ filter, and will not appear on customer statements. The disadvantage to this method is that you will not know to what invoice the overpayment was intended unless you review the line item notes for the credit memo.
UNDERPAYMENTS
If a customer underpays, the invoice remains open, unless you enter the difference in the DISCOUNT field. You will probably want to do this in the case of very minor underpayments where leaving an invoice open for a few cents is not practical. To do this, simply enter the difference in the DISCOUNT field. You can use the default SALES DISCOUNT ACCOUNT to apply the difference, or use another miscellaneous expense account if you do not wish this amount to affect the balance of your true sales discounts in the G/L.
RECEIVING PAYMENT WHEN INVOICING
If you need to receive payment at the time of invoicing, for walk-ins and CODs, you can enter the payment directly from the Sales Order Browse after invoicing by pressing the [Payment] button at the bottom of the Invoices or Open Invoices tabs.
PREPAYMENTS
If a customer sends money for work, you can enter a sales order for it and apply the payment to the order. After the sales order is entered, you can enter a payment against it:
A. Create a line item. Select Pre-Payment as the payment type. The orders Transaction ID is used to link the payment with the Sales Order.
B. Enter the amount paid.
When you Post Payments, the payment will be credited to the Sales Order. When the Sales order is invoiced, the invoice status will be correctly update to reflect the payment.
If you wish, you can also enter a pre-payment directly from the Sales Order Browse in exactly the same manner as described above for Receiving Payment When Invoicing. In this case, the orders Transaction ID is used to identify the payment, as opposed to the customers invoice.
CLEARING INVOICES WITHOUT RECEIVING PAYMENT
From time to time you may wish to close an invoice for which no payment is expected to be received. This can happen for a number of reasons:
- Data entry errors where a customer was overcharged on an invoice.
- Bad Debt Customers, from whom there is no reasonable likelihood of collection.
- Charitable Contributions.
In each of these cases, we wish to clear the invoice without reversing the sales information (in which case we would enter a reversing invoice as described in Sales Orders) and in each case, no cash is received. Use the following procedure for all such cases:
- Enter the Customer ID, a document number, and 0.00 in the PAYMENT field.
- Enter the invoice to credit in the line item INVOICE field.
- Enter 0.00 in the AMOUNT field for the line item. Leave the ACCOUNT field as the default A/R account.
- Enter the entire amount due for the invoice in the DISCOUNT field.
- In the DISCOUNT ACCOUNT field, enter the appropriate account for this transaction.
- In the NOTES field, enter an explanation for the credit.
By default, Simple Accounting does not include sales discounts in the commissionable portion of sales. Therefore, closing out an invoice in this manner, in effect, makes the invoice non-commissionable. To override this behavior, you will need to override the commission on the affected order.
