Unapplied payment means that you performed the function of receiving payment, and it is not “attached” to an invoice. Though this is the general definition of Unapplied payments today we will learn in more depth of how to apply unapplied payments and fix the unapplied cash payments in QuickBooks accounting software.
Unapplied Payments in QuickBooks
For Bookkeepers if a customer made an entry for their payments but if they forgot to apply the same to their accounts payable then QB will have a major role to play. They will help you apply for the unapplied payments by matching them with the proper invoices. All you need to do is review them.
To do this just follow the steps.
- Select Reports.
- Customers & Receivables.
- Open Invoices from the menu bar.
- This should be done from the start to make any adjustments.
- This is an important step if you have more AR in your COAs.
How to Fix the QuickBooks Unapplied Cash Payment Income
Unapplied cash payment income could be visible when you run a profit and loss report using the cash method. For proper tax reporting, QuickBooks creates this account.
Unapplied cash payment income might show up on your report if.
- Before creating the sales form (invoice or sales receipt), a customer paid you in advance, and you recorded the payment.
- Without matching them to sales forms, you entered payments.
You can fix the unapplied cash payments income on profit and loss report by taking the steps below.
Step 1: Run the Open Invoices Report
To run the report on open invoices.
- Select Reports under Business Overview.
- Enter Open Invoices in the section labeled Find report by name.
- Choose Run report after setting the reporting period.
- Find a transaction marked as a Payment in the Transaction Type column.
Proceed to Step 2 if the Payment transaction matches an open invoice. Go straight to Step 3 if you don’t find a matching open invoice.
Step 2: If the Payment transaction matches an open invoice
These steps should be taken if the payment matches an open invoice.
- To open, choose the payment date.
- Check the open invoice under Outstanding Transactions.
- Close after selecting Save.
Step 3: If the Payment transaction doesn’t match an open invoice
You will have to create the transaction if the payment does not match to an open invoice. Follow the below steps:
- First, you have to select +new
- Choose Invoice under Customers.
- You have to fill out the same customer, payment amount, and date on the form as the payment.
- Close after selecting Save.
- Then you have to return to the report on Open Invoices.
- Choose the date to open after locating the unapplied payment.
- Check the open invoice under Outstanding Transactions.
- Then you have to select Save and then click on Close
- To see if there are any other transactions listed as a Payment, check your report of open invoices. If so, go back to step 2 and repeat it for each.
Now run a second time your Profit and Loss report. The income from unapplied cash payments should no longer be shown.
How to Apply Unapplied Payments in QuickBooks
If you want to apply an Unapplied Payment, you are supposed to make an Invoice to apply the payment follow the steps mentioned below.
- Create (+) > Invoice under the heading of the customers
- Enter all of the information to make the Invoice match the Unapplied Payment
- Click Save
- Select Receive Payment in the top right-hand corner
- Find the Credits section and select the Unapplied Payment
- Select Save and Close
- Once you have completed these steps the payment will be applied and then Closed.
The steps given above will help you sort your query how to fix the unapplied cash payments in QuickBooks. If by any chance you were not able to follow the steps above then let us know in the comment section below. For instant help, give us a call now and resolve your issue right away. You can even give us a call at our QuickBooks consultant for USA, Canada, and the UK and talk to our Experts now.
