How to Apply Vendor Credit in QuickBooks Online: Step-by-Step Tutorial
In QuickBooks Online, applying vendor credit allows you to deduct the credit amount from an open bill or invoice, reducing the amount owed to the vendor. This feature is especially useful when you receive credits from vendors for returned items or overpayments. In this article, we will guide you through the process of applying vendor credit in QuickBooks Online, step by step.
To begin, log in to your QuickBooks Online account and follow the instructions below:
Step 1: Access the Vendor Credit Section
First, click on the “+” icon at the top right corner of the QuickBooks Online dashboard. In the drop-down menu, under the Vendors section, select “Expense” to access the vendor credit section.
Next, select the vendor for whom you want to apply the credit from the “Payee” drop-down menu. It is important to ensure that the vendor is associated with the credit you received.
Then, choose the bank account from which you want to pay the credit in the “Payment Account” field.
Now, let’s move on to the next step.
Step 2: Enter the Vendor Credit Details
In this step, you need to provide specific information about the vendor credit. Fill in the following fields accordingly:
- Date: Enter the date you received the vendor credit.
- Ref no.: If applicable, enter the reference number provided by the vendor for the credit.
- Category: Choose the appropriate expense category for the credit. If unsure, consult with your accountant.
- Description: Provide a brief description of the credit, such as the reason for the credit or any other relevant details.
- Amount: Enter the amount of the credit you received from the vendor.
Once you have entered all the necessary information, click on the “Save and close” button to proceed.
Now that the vendor credit details are saved, let’s move on to the next step of applying the credit to an invoice or bill.
Step 3: Apply the Vendor Credit
After saving the vendor credit, you will be redirected to the expense transaction page. Locate and click on the “+” icon to add a new expense.
In the expense transaction page, either create a new expense or select an existing bill or invoice to which you want to apply the vendor credit.
If you are creating a new expense, enter the required details for the transaction, including the vendor name, date, expense category, and amount. In the “Add to expense” section, click on the “Apply” button next to the vendor credit you want to use.
If you are applying the credit to an existing bill or invoice, open the transaction and click on the “Add vendor credit” link. Select the appropriate vendor credit from the list.
Once you have applied the vendor credit, the amount will be deducted from the bill or invoice balance. You can verify this by checking the updated balance in QuickBooks Online.
Thank you for reading our step-by-step guide on how to apply vendor credit in QuickBooks Online. This feature provides an efficient way to manage credits from vendors and reduces the amount owed. By following the instructions provided in this article, you can easily apply vendor credits to outstanding bills or invoices. If you have any further questions or need assistance, don’t hesitate to consult the QuickBooks Online help center or reach out to customer support. Happy accounting!
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