“Hope you can help me with the problem I am having with QuickBooks. I started working for this company before 3 weeks as a Bookkeeper/Accountant who uses QuickBooks Pro 2010 and have Cash Basis Accounting. I am new to QuickBooks, when I saw their balance sheet they had a big A/R negative balance, the reason being they don't create invoices in QuickBooks, they have another system where they generate invoices. What they do in QuickBooks is charge Credit cards. So when they are charging credit cards (Receive Payments) Undeposited Fund is debited and A/R is credited. And when the deposit is cleared it goes Bank DR. and Undeposited Fund CR, so there is a big chunk in A/R that is accumulating which now needs to be cleared. Please can you advice how about can I clear the A/R. The bank reconciliation is up-to-date till October 31, 2010.”
Why can't the person simply make a journal entry debiting A/R and crediting the appropriate revenue account? From the info in the question, there has been no revenue booked yet… Or, am I missing something?
Fixing it with a single journal entry isn't possible because QuickBooks only allows one A/R or A/P account per journal entry. So you'll have to enter separate journal entries for each customer. Worse, using journal entries will actually cause more work because you’ll have to go back into each payment to apply it to the journal entry you created. Since you have to do them one at a time anyway, it’s much easier to just create the invoice and apply the credit right on the invoice.
But more importantly, QuickBooks works much better with transactions. For instance, journal entries aren’t going to show up on your sales reports because they’re based on sales items and you can’t enter items on journal entries. Of course, you can modify your reports to include them but now you've introduced unnecessary complexity to the fiie.
For this reason, I recommend avoiding journal entries unless absolutely necessary and never ever using them to replace a transaction. They should be limited only to non-transactional entries, like depreciation or prepaid expenses, and even then if you are doing job costing you’ll need to do a $0 transaction instead because most of the job costing reports are based on items.
The register reads as:
10/15/2008 ______________________ $50.00
When I believe it should read as:
10/15/2008 Smith, John $50.00
RCPT Indiv. Contributions
My question is do I need to delete all the sales receipts (donations) and all the deposits, and re-enter each donation for the last 2 years, or is there a shortcut to fix this? Thank you for your assistance. I signed up for your email newsletter; looking forward to receiving it.
If you are using the Nonprofit edition, there are several good donor reports in Reports > Nonprofit Reports. The Sales by Customer reports (in Reports > Sales) and Transaction List by Customer report (in Reports > Customers & Receivables) might also be useful.
That said, all you need to do is apply the credits created by the journal entries. For A/R, open the unpaid invoice and select Apply Credits. There’s an Open Invoices report in Customers & Receivables, which also shows you all the unapplied credits. For A/P, open the unpaid bills and select Set Credits. There's an Unpaid Bills Detail report in Vendors & Payables. For every negative you see on these reports, you should open the associated invoice or bill and apply the credit.
Maybe just as importantly, you can modify the Unbilled Cost by Job and the Time by reports to filter Billing Status for Not Billable to get a list of expenses and time you didn’t bill to the Customer:job you entered.
Once you’ve turned it on, select the link How do I use multi-currency feature? and watch the 5-minute video and read through the overview. You can also select the Help button for more information.