QuickBooks Receiving Payments & Making Deposits, Part 1

Welcome back to Educator.com.0000

This is QuickBooks lesson: receiving payments and making deposits.0002

One of the greatest things about business is receiving money from our customers.0008

And we are going to go ahead and show you how to record customer payments and record a payment in full for a single job.0011

The first thing that we are going to do is we are going to show you how to record that payment that our customer gives us,0020

which is the greatest thing on earth- receiving money, and that is what we are in business for.0029

The first thing we want to do is we want to do is we want to go ahead and open up our Customer menu so we can actually look at our Customer Center.0034

Or from the Customer menu, we can say Receive payments.0042

Receive payments comes up in the window, and the first individual we are going to go ahead and receive money from is, let's say, Violet Mike.0047

And we are going to choose the job Workshop.0057

We notice that there is an amount due there, and the amount that we are going to receive from him is in full for that particular job.0062

And the amount due is 4732.23 is the amount of the check that we received from Mr. Mike Violet. The payment method, we are going to choose Check.0069

As you notice, there are a variety of methods that we can receive money from.0084

We can actually receive credit cards, and there are also online payments, as well, but that is at a much later lesson.0088

So, we are going to choose check. The check number that we are going to put in here for that check is 6745, and we will hit tab.0099

We can also put in a memo that this is payment in full and hit tab. Notice that when we put in the amount, it automatically checks the open invoice.0110

If we had multiple invoices, it would check the latest or the oldest invoice first and so forth.0125

So, we will go ahead and show you that a little bit later, but this is how we have it.0132

We have that the check is being applied in full to this particular invoice, and at this point in time, we can say Save and new.0136

Now, notice that what happens in the transaction in QuickBooks is when we receive that,0146

it is going to debit an account called Undeposited Funds because we have not assigned it a bank account yet.0152

So, it goes ahead and creates this Undeposited Funds account, and it credits that receivable invoice.0161

If we wanted to look at things, we can pull down our Lists and look at Chart of Accounts.0167

And we would notice that there is an Undeposited Funds area here in Account.0173

It is just a holding account until we assign those funds a deposit in a particular bank account.0178

If we have multiple bank accounts, then, we have a payroll account. Maybe we have an operating account or other bank accounts.0184

We can actually deposit those funds into multiple different various accounts.0191

So, it holds the money in Undeposited account, and we will go ahead and show you how to make deposits a little bit later.0195

But, just notice that, that it does put in the deposit that we just made of 4732.23 into this holding account called Undeposited Funds.0203

And it credits the accounts receivable account lowering the amount of what our customers owe us.0212

Now that we have learned how to record a payment in full for a single job,0218

we are going to go ahead and talk about entering a partial payment that a client gives to us.0223

So, assuming that a client gives us a little bit of money, not the full amount, then, we can apply that to a certain given invoice.0229

Many times, customers might just pay us for an individual or certain invoice or just partial of that.0235

We might have a customer that has multiple invoices outstanding, but they send just a payment of, say, $1000.0243

And we are going to apply that to a particular invoice that the customer wants.0250

A lot of times, the biggest problem in doing business with other businesses, is when we have multiple invoices that are outstanding.0254

And the customer wants to make a payment towards one given invoice.0264

They might have forgotten about older invoices or newer invoices, but they will indicate that they are paying for invoice X.0269

So, we want to make sure that we reflect the same accounting method, so that when we go over the records with our customer,0278

we can reflect what they have intended to pay and still go after the uncollected amounts that are still outstanding.0284

So, with our Received Payment window open, we are going to type in the customer Eckert Designs, and this is for their office repairs.0293

We have a particular invoice there. Let's see if we have other invoices for Eckert Designs.0307

We will just click on...we will choose a different person here. Let's see.0315

Eckert Designs is probably going to be the best one for what our example is.0324

We can actually look at our customers here and see if there are multiple invoices that are outstanding, and here is Robert Allard.0332

So, we are going to choose Robert Allard as an example here for our received payments.0341

So, instead of Eckert Designs, let's type in Allard, and there are multiple outstanding invoices for this particular customer on Robert Allard.0345

It is a good example.0355

We are going to receive a check of $1000 from Robert Allard, and he wants to make sure it is towards the invoice no. 1100.0356

So, he is not going to pay it full, but he is just going to pay $1000, so in the Amount field, we are going to type 1000 and hit tab.0367

It is a check, so we are going to make check is there, and it is check 1204. We are going to say Partial payment for invoice no. 1100.0375

That is what he put on his check. That is what his little note was in the mail that we received, so we are going to go ahead and click on that.0391

We notice that when we do that, it puts in the automatic payment towards the oldest invoice.0397

Well, that is not what we want it to be, so we are going to say Unapply the payment, so it is going to remove that from the listing.0404

And we are actually going to assign it to this invoice that the customer intended it to be paid for, and that is invoice no. 1100.0411

And, of course, he owes us for this other remodelled item.0421

We are not going to charge it on that. That is going to be towards the invoice 1100.0429

Here, it says the amount due. There is an underapplied amount, and we are going to leave this as an underpayment, OK,0433

because he still owes us $1400, so we are going to leave this as an underpayment.0442

When I had to write off the extra amount, we are going to leave it as an underpayment and click on Save and new.0447

It goes ahead and records that again. We are going to notice how it deposits that $1000 and records it under that Undeposited Funds account.0453

And you will notice here under Undeposited Funds, it went up a little bit by $1000. Here is the $1000 payment that we have.0464

So, it leaves it there. We have not assigned it and deposited that check yet to a bank.0473

Now that we showed you how to record a payment in full for a single job, and we showed you how to enter a partial payment,0481

now, we are going to go ahead and show you how to apply a one payment to multiple jobs.0490

So, a client might go ahead and pay the balance of their entire bill for multiple invoices.0495

We are going to show you on Robert Allard again. Now, we finally get a check from him0505

for the balance of what he truly owes us for all the invoices that are outstanding.0509

So, we are going to type in our customer is Allard, and the total amount due is $16,679, so we are actually getting a check for 16,679.03. Fantastic!0512

We would love those kind of clients that pay us in full, and it is going to be 1209 check number, and this is payment in full for all outstanding items, OK?0530

Notice when we click on this 16,679.03, it selects all outstanding items, and, of course, it matches the amount due. It is 16,679.0551

Apply this 16,679.03. There are no discounts or credits applied, and we are good to go.0562

The payment method, of course, is check, and we have got our check number of 1209.0569

We can say Save and new, and it records that payment in full for all items.0576

The next item that we might want to look at is entering overpayments. We might have a customer that has overpaid us inadvertently.0585

For various reasons, the client might overpay us. We do not mind that.0592

We can apply it to future jobs if we definitely have future work going on with that particular customer, so how to do that?0596

We are going to choose a customer. We are going to look at our customer list.0605

We have looked down here that we have Mike Violet, that there is a utility shed that we have a $35 outstanding bill.0609

Let's say he pays us $100 towards that, so we are going to go ahead and choose Mike as our payment there.0618

Again, it is Mike Violet, so in our Received from, we are going to say Violet Mike. It pulls up the $35.0628

We are going to put in $100 check that he writes to us. The method is check, and the check no. is 409.0638

We have that. Notice that when we do that, it says we can refund the amount to the customer, or we can leave that amount on account.0650

And at this point in time, we are actually going to refund it because he overpaid us.0662

We did not mean that, and we do not really see much more work for this particular customer.0666

So, we are going to go ahead and refund that amount to the customer.0672

It is only fair. We are not going to keep his money if we do not foresee any future work with this particular client.0674

So, we can choose Refund the amount to the customer, and we can say Save and new.0681

Now, it is going to open up the window Issuing a Refund. Yes, we want to issue a refund.0688

We are going to want to write it from our checking account, and we also have various ways0696

where we can give him a refund against his credit card, for accepting his credit card.0703

But, this is easier if we are going to go ahead and write a check and mail it to him.0707

And we will go ahead and put in a memo here if we want to do overpayment on invoice, and that was invoice 1102.0711

So, it was an overpayment on invoice 1102, and we are giving him the $65 back.0729

We will go ahead and say It is going to be printed and click on OK.0734

Now, we go ahead, and we have created a check that we can now print at a later date for that customer and give him that overpayment refund check.0744

Again, thank you very much for visiting us at Educator.com. We will see you next time.0754