I have several transactions that are billable expenses incurred on a company credit card. This credit card is listed under my bank accounts and has been used for business expenses, but never for expenses I could invoice to a customer. I invoiced the billable expenses and upon customer payment of the invoice I applied the payment. This all went smoothly and created a zero balance in the billable expense account. My problem began when I went to pay the credit card statement that had these billable expense transactions. When I originally posted the transactions to the credit card account I listed them as billable expenses and chose the customer. Now when I go to post my payment I went to choose “Billable Expenses” and the customer again and post the credit card payment it creates a duplicate payment to the Billable Expense account. (I.E. it shows both the customers payment and my payment to the credit card account and now has a negative balance) Is there a different account I should be using for the credit card payment instead of Billable Expense again for these reimbursed transactions?
Can I suggest that you read these guides as parts of the process you describe above is not correct::
Record Billable Expenses Manager Cloud
Invoice Billable Expenses Manager Cloud
I’ve read these multiple times and even had a fellow accounting friend look at my Manager and they agree I’ve done these steps correctly.
It’s after all of these steps I’m running into the problem.
Everything clears…until I go to pay my business credit card. The payables need to have a suspense account to go to and those transactions accounted for as billable expenses and listed on the customer invoice as Credit Card - (description of billable expense activity) are giving me trouble.
If I had used cash to pay for these billable expenses none of this would be a problem. It would clear fine. It’s only due to the fact they were first incurred using our business credit card and listed as billable expenses, then invoiced from the list of billable expenses, and paid by customer. I can’t seem to post my credit card statement payment without causing another billable expense payment.
Am I missing something? Thank you for looking at this. I know I’m not an accounting whiz, but I’ve never encountered a problem with Manager until this.
Ok, these statement from your first post don’t make sense.
1 - I invoiced the billable expenses and upon customer payment of the invoice I applied the payment. This all went smoothly and created a zero balance in the billable expense account
The payment from the customer shouldn’t be going anywhere near the billable expense account.
Their payment should only be allocated to their accounts receivable balance.
2 - Now when I go to post my payment (credit card)I went to choose “Billable Expenses” and the customer again and post the credit card payment
The payment to the credit card shouldn’t be going anywhere near the billable expense account.
The credit card payment is only a transfer between your bank account and the credit card.
The steps are these:
- Allocate the credit card charges to the billable expenses account + customer.
- From the Customers tab invoice the billable expenses by selecting “Uninvoiced”
These two steps clear the billable expenses account so no further entries to billable expenses are required.
- Payment from the customer gets allocated to their accounts receivable.
- The credit card gets paid via a payment from the bank account
Correct! I obviously did not explain myself well the first time around. My apologies. I am doing the exact steps you listed. I was trying to merely preface the steps I took. I should have just said “Problems with credit card payment transactions”
The payment from the customer for the invoice is being entered as:
- Choose the customer, click on the invoiced amount, receive payment
After that I go to the summary page and see that the billable expense account has no balance (i.e. my zero out comment). I’m not actually posting any transactions to the account, just stating that it now shows no balance. A/R balance gets credited, cash gets debited.
I agree the credit card payment shouldn’t touch billable expenses as well, but what account should I use to post the payment for the transactions that were used as billable expenses? I still owe for these amounts, but they aren’t true business expenses to report so I can’t use an expense account. Does this make sense? All of my credit card statement payments have been itemized by each transaction so as to report my business expenses appropriately. Since these are not falling into that category I am so confused.
Before you reply - it just dawned on me that creating the Invoice is what creates the Zero Balance on the Billable Expenses. Not the payment. I have no idea where my brain has checked out to.
By trying to apply the payment transaction to the Billable Expense account again I understand I’m creating a balance and Not invoicing again.
I just don’t know what account to use.
Lets build this model,
The credit card receives a charge for 60 which is a customer billable expense. This is entered into the Credit Card (bank account) via a Spend Money using the account billable expenses + customer.
The Customer is invoiced 500 plus the 60 billable expenses.
So sales gets 500 and the invoiced 60 clears the billable expenses account and the customer’s accounts receivable balance becomes 560. The payment 560 is received and is allocated to accounts receivable to clear that balance.
The credit card’s business expenses and billable expenses totals 740. An Inter Account Transfer from the bank account to the credit card for 740 clears the credit card balance.
I had never enabled Inter Account Transfers!! That solves my problem (and means I get to re-evaluate the itemization of credit card transactions I was using). Thank you so much for your patience and assistance. Ive spent an entire week racking my brain over this and exploring a million different solutions. Here it was simple.
Inter Account Transfer are okay if you are doing manual entries, but if you are using the Import Bank Statement process for both the bank account and the credit card account, then you need a “transaction clearing” account - read this modified excerpt:
Bank/Credit Card Transfers are two separate accountings transactions not a single transaction.
1.Bank: Spend Money - Credit Bank and Debit ???
2.Credit Card: Receive Money - Debit Credit Card and Credit ???
The Inter Account Transfer feature in Manager allows you to truncate that to a single entry - Credit Bank and Debit Credit Card
However, when importing bank statements and using Bank Rules, the processing of two transactions is still required because (rightfully) Manager’s Bank Rules prevents any allocation directly to other Bank/Cash/Credit Card accounts otherwise you would have duplicate transactions as demonstrated below.
If you substituted the above ??? for the opposing Bank/Credit Card account you would now have:
1.Bank: Spend Money - Credit Bank and Debit Credit Card
2.Credit Card: Receive Money - Debit Credit Card and Credit Bank
The Bank account now has two credit entries and the Credit Card account now has two debit entries - hence the duplication. So to use Import Bank Statement you just need in the Bank Rule to post the opposing debit/credit entry to a clearing account, where the contra from the transactions will cancel themselves out.
1.Bank: Spend Money - Credit Bank and Debit Clearing Account
2.Credit Card: Receive Money - Debit Credit Card and Credit Clearing Account
The Clearing Account can be created as either a Current Asset or Current Liability.
In actuality, the end process was to use a Clearing (contra) Account as (good guess) I was importing my Statements. Thank you for your assistance!
This should have been simple, but it became a complicated mess that my over-analytical tendencies made worse.