Unapplied cash payment appears to be a self explanatory term. However, in generic words, unapplied payments are money which has been received from the customer’s accounts and has not been applied to invoices and debit memos. Chances are, when you see such unidentified payments, you may not know which customer account the payment belongs to. You also may have to look for the correct invoice the payment should be applied to. Another scenario can be that you receive a payment from your customer that exceeds the balance on their invoice. Both ways, you may end up combing your records to check where your missing payments are.
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How to Find Unapplied Payments?
If you are reporting the payments on a cash basis, you should see two different accounts for the unapplied cash payment entries. Such accounts with intricate details are automatically created by our best chosen accounting solution, QuickBooks.
Here are some details for each of the two account types that are created under QuickBooks for reporting unapplied payments:
Unapplied Cash Payment Income
This specific account of Unapplied Cash payment Income is used for reporting income on a cash basis. Income such as customer payments that simply have been received but have not been applied to any sales form. In other words, the money was taken in, but never was declared as the income on a sales form.
In usual cases, the date of the payment comes before the invoice date. And, later on invoice date, it is applied to. For example: You may have received payment today and invoice date is next week. It stays “unapplied” until the next week, when the invoice hits the books.
Ideally, if an incorrect amount shows up in this QuickBooks account, then, you will need to apply that missing payment to a correct invoice dated prior to the payment date. Otherwise, the Unapplied Cash Payment Income will stay correct.
Another possible scenario is that any product or service item on the invoice is profiled to a bank account type. This will take the amount to go into Unapplied Cash Payment Income, for actual payment not being received. You need to ensure that the product or service is mapped to the correct account type in order to prevent this from happening.
Unapplied Cash Bill Payment Expense
This is also another type of cash payment income but will be counted on the expense side. This account is used to report the Cash Basis expense from supplier or supplier payment cheques that you may have sent but are not yet applied to a supplier bill. It can also occur in the case of a credit card account balance for which a bill is created. You will never be using this amount directly on a purchase or sales form.
If any incorrect amount starts showing in this account, you will need to apply the bill payment to a particular bill that is dated before the payment of the bill. Doing it manually can be a tedious process to follow, however, with QuickBooks, it seems just the matter of a few clicks.
Steps to find the Unapplied Cash Payment in QuickBooks
QuickBooks are designed to make your work easier and better in terms of accuracy. In order to see the Unapplied cash payment, you may want to run the Profit and Loss report using the cash method. Following are the steps to do so:
- First of all, sign-in to QuickBooks account.
- Then, click on Reports tab> Profit and Loss.
- Select the custom date to choose a specific Report period,
- Under the Accounting method, Select Cash.
- Then, you need to Click Run report.
- Go to the Income section, select the amount for the Unapplied Cash Payment Income.
You will see all the details of the unapplied payment in the Transaction Report. In order to check if the given payment matches with an open and available invoice, you can also run the Open Invoices report by following these steps:
- Go back again to Reports and then type Open Invoices in the search field.
- You need to choose the custom Report period and click again on the Run report button.
- In the Report, locate the Transaction Type column and then find the transaction listed as a Payment.
If any of the payment matches an open invoice, you can choose the Payment date to open the transaction and select the specific invoice.
If at any point, handling all of this information seems too overwhelming, you can always get assistance from QuickBooks Experts as well. We are one of the best service providers which you can look to for QuickBooks assistance. All you need to do is to call them and hand over the required tasks and our experts will take it from there.
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Why do I have unapplied Payments in QuickBooks?
Whenever you enter bill payments or cash payment without matching them to bills or invoices is the basic reason you will see an unapplied payment in your QuickBooks account. In general terms, a payment was made or received but never reached record books. The best way to resolve the issue is to retrace the steps and redo the record entry with correct details.
Where can I find unapplied Payments?
The quickest way to find out whether you have any unapplied payments or not, is to run a report named “Open Invoices” under Reports sections of QuickBooks. Then, choose Customers and Receivables. In this report, if you see any negative numbers, then you have payments or credits which are not applied in the account.
How to Unapply a Payment in QuickBooks online?
To reach one goal, there are always several ways or routes to take. If you just need to unapply a payment in QuickBooks online, you need to take the following steps:
Login to the QuickBooks account.
Click to Sales, then choose the All Sales tab.
Choose the filter of the type of transaction for Money received, then hit Apply.
Locate the payment you wish to undo.
Click on More, then choose Delete from the drop down.
With this, the payment has been deleted successfully.