READ THIS POST - Applying Credits.

Question:

I am new at QuickBooks. The A/P department before me had entered some credits on different vendors. Why does the credit show on the vendor unpaid detail list. Were the credits entered incorrectly?

Answer:

This is a common problem. I was discussing this with someone the other day.

The problem is that when you enter a credit...or issue a credit memo QuickBooks will show the amount in the balance, but it will not apply the credit.

All that you need to do is to apply the credit to the bill that the credit was issued on. Follow these steps:

1. In the Unpaid Bills Detail Report, you should have both a bill and a credit that cancel each other out in terms of balance. Make a note of the bill information.

2. Open your pay bills screen (Vendor - Pay Bills). Make sure that the radio button is checked so that all bills are displayed.

3. Place a checkmark beside the bill that you noted earlier.

4. Down at the bottom of the pay bills screen, you should have a button titled "Set Credits". Click on that button and apply the credit to the bill in question.

I hope this helps everyone reading, because I have yet to see a QuickBooks file that didn't have this issue at least once.