I have a customer who ‘overpaid’ me on an invoice so he’d have money available for small items as needed. I basically just showed the payment on his invoice as what the check said. He now has a ‘credit’. He got a grant and purchased another large system. When I created the invoice, it automatically took off the money he still had on account. I can’t figure a way to not make that happen. I can edit the PDF of his invoice before I send it to leave out this credit but I’d like to do it in the software. Have I missed something? Is there indeed a way to do this?
Thanks!
You have missed a couple things.
First, if you allocated the earlier payment to a specific sales invoice, that invoice would be shown as overpaid and no amount would carry forward to subsequent invoices. But then you would have to deal with the overpaid invoice.
Second, you could have split the payment into two line items, part for the first sales invoice and part allocated only to the customer. But then you would still have automatic allocation to subsequent invoices. Why that is undesirable you have not said.
If you want to hold the overpayment separate, you will need to use special accounts. There is a Guide about that.
Looking back at the original transaction, I applied the check to their account so the original invoice did not show up as overpaid and the extra money did show up in their customer status.
In these particular cases, customers get grant amounts for a certain dollar figure. they may not spend exactly that amount, perhaps a bit under, but want to have the money available to use for other items down the road - usually small items. In this particular case, he got another large grant and wants to use ‘all’ of that money towards this purchase, leaving the other amount there for smaller items going forward. We have had (in the past before I started using Manager) customers who paid me a sum every month, not necessarily the same amount, knowing that they’d be getting something bigger down the road and wanting to build up money towards it.
I hadn’t thought to use Special Accounts for this kind of thing since it’s not a common situation. I’ll read that over and see about using it moving forward.
Thanks.
You are basically saying because someone overpaid you that this now becomes a liability. However, you want this to be a credit. I do not think you need to change anything as their “overpayment” if correct shows as a liability to you. I may be wrong but please check.
It does show up correctly as a Liability the way I did it. I was only questioning if there was a way to choose to apply it to a particular new invoice or not per the customer’s request. Looks like there is not unless I use a Special Account for it.
That is correct. Any unspecified credit on a customers sub account in Accounts receivable is available and will be applied to the next invoice. You have to take active measures to prevent that, and that is what special accounts are for.
If I understand you correctly, there are a few things you could do without using special accounts. Here is an example workflow:
- The customer makes an order for $900, and you generate the sales invoice, SI#1.
- The customer makes payment of $1,000, being $900 towards sales invoice SI#1 plus $100 towards future small purchases.
- You create a receipt for this payment, R#1. In the receipt you create two lines. The first allocates $900 to sales invoice SI#1, and the second line allocates $100 to the customer’s Accounts receivable.
- The customer makes another order for $900 and a corresponding payment of $900.
- You generate the sales invoice, SI#2. Manager allocates the $100 credit on the customer’s account to this invoice. You don’t want this, so…
- You generate the receipt for the $900, R#2. Here you just have one line, and make sure that you assign the receipt to sales invoice SI#2. Manager will then carry the previous $100 credit from the first payment over to the next future invoice, and sales invoice SI#2 will show only the payment of $900 receipted against it.
- Optionally, when you generate another invoice for the small purchases, you could return to the first receipt, R#1, and specifically assign some of that amount to the invoices you choose.
Obviously this won’t help you if you need to send the customer SI#2 before they have made the payment against it, as it will still show the credit balance from receipt R#1 applied. I guess another option here would be to temporarily assign the full amount from the payment to invoice SI#1 (which will then show as overpaid) just while you create the PDF of SI#2 to send to the customer.
Perhaps @Tut’s suggestion of using special accounts will be easier. It might depend on how frequently you will be doing this kind of thing. If it will happen often, or you will want to carry the small credit forward past multiple other invoices, then I suspect the special accounts option will be easier. But if it’s just a once-off then my method above might be easier.
Honestly, since this doesn’t happen all that often, I’m likely to stick with what I just did last week - I’ll take the PDF of the new invoice (i.e. #2) and simply remove the line showing any previous credit payment and set the Total to the full amount. I’m both the owner and the accountant here so I’ll know what’s happening and if it doesn’t show correctly in the system until I receive payment for the current invoice, it really won’t matter. If this becomes a more common occurrence, I’ll look at Special Accounts.
Thanks for the suggestion though!