QuickBooks Asia

Adjustment amount disappear from Credits Used column

In some of the foreign currency transaction such as applying an adjustment amount (Credit Note) to a Bill, the Credit amount disappeared from the Credit Used column. Besides, the Pay Selected Bill button was grey off.

Scenario:

Software used: QuickBooks Enterprise 2009/10 Asia version

Home Currency: USD

Exchange Rate:  0.14972 Chinese Yuan Renminbi : US$1

01 Nov 2010, create a payment via Write Cheque to Supplier A (as a deposit) for the amount of Y59,570.00 (Renminbi). Since this was a deposit, the account used will be Accounts Payable – RB (Currency = Chinese Yuan Renminbi).

10 Nov 2010, received Bill from Supplier A, Bill amount was Y59,570.00; enter the Bill with item as per normal.

Since this Bill was already ‘paid’ earlier, you are required to knock off so that it will not show as an outstanding bill. To do it, simply do a Pay Bill to Supplier A.  In the Pay Bill window, select your bill to pay, click the Set Credit button and select the Payment which you did earlier.

Problem …

After you have selected this Payment from the Set Credit sub-window, the credit amount does not show up in the Credit Used column, besides, the Pay Selected Bill button was grey off.

It seems to be a bug in the default Chinese Yuan Renminbi currency. I did a test, when the amount was less than Y5,000.00, the bill can be knocked off by Set Credit method. However, any amount greater than that will have an error.

To resolve it, I created a new Chinese Yuan Renminbi currency in the currency list (I named it as RB, it can be any prefer name). Next, I created a new Accounts Payable account (I named it as AP-RB) and link it to this currency; all the supplier or customers that require trading in Renminbi will link to this currency too.

Now, when I created a Payment and Bill with this newly created currency, I can knock it off by using Set Credit method without any problem. 

 

May I have a refund?

It is normal sometime you need to refund customer for goods that rejected or an over charge on goods or services. In QuickBooks, how can you record a refund to customer?

Example:

You invoiced your customer on 10 July 2010 for a service of $749.00. Customer made a payment to you, full amount of $749.00, and you applied it to your invoice in QuickBooks. Then, on 20 July 2010, customer complained about the service and you decided to give them a full refund.

Since payment had already done, so how are you going to record this transaction in QuickBooks and give your customer a full refund?

 

To start, you need to create an Adjustment Note (Credit Note). An Adjustment Note is to create a negative balance in the Accounts Receivable account of this customer and to reduce the Sales account amount from your Profit & Loss report. The double entry will be debiting Sales account and crediting Accounts Receivable account. If you are creating an Adjustment Note for an Inventory item, then, Cost of Goods Sold account and Inventory Assets account will affected by this entry.

Once you created the Adjustment Note click the ‘Use Refund To’ button at the top of the Adjustment Note and select Give a Refund. QuickBooks will display an Issue Refund form for you to record the cheque details. This transaction will debit Accounts Receivable account and crediting Cash at Bank account. 

Hope this is useful to you. To know more about QuickBooks; do sign up my QuickBooks Training Class at www.QB.sg.

Adjustment

10 Sep 2009, created an invoice (invoice number 1001) to Customer ABC Pte Ltd for $1,000.00.

15 Sep 2009, ABC Pte Ltd sends you a cheque of $950.00 for the payment of invoice 1001. Customer deducted the $50.00 off as a discount you had agreed earlier. However, your Accounts Assistant had entered it as $1,000.00 (full payment).

20 Oct 2009, your Accounts Assistant created a Credit Note $50.00 for ABC Pte Ltd.

31 Dec 2009, accounts closed. Nobody spots the mistake. Accountant did not do any Bank Reconciliation in QuickBooks.

10 Apr 2010, Accountant spots the mistake.

If you are the Accountant, what will you do to adjust these transactions?

Since this account had already closed, you should not go back and edit the transaction (that is 15 Sep 2009, Receive Payment), unless your Auditor allows (In most cases, the adjustment will be done via an Audit Adjustment). However, if your adjustment were to make in this financial year, below are the steps you can do to resolve your issue.

The Bank account overstated by $50.00; you should pass a journal to revert it back to $950.00 instead of reflecting as $1,000.00. The Accounts Receivable account understated by $50.00, you need to debit back $50.00 to balance up the account. Therefore, the General Journal entry (dated 10 Apr 2010) should be debiting Accounts Receivable account $50.00 and crediting Bank account $50.00.

Now, your Bank account balance is $950.00, which is correctly stated. Besides, your Accounts Receivable account is also correctly stated, zero balance.

Although your Accounts Receivable account is zero balance, the debit journal (dated 10 Apr 2010) and credit note (dated 20 Sep 2009) are still shows in the Accounts Receivable Ageing report. You need to do a Receive Payment (physical receive $0.00 amount) to offset the Credit Note with the Debit Journal.

Back to Basic – QuickBooks 2009/10 Asia’s Home Page

QuickBooks 2009/10 Asia has been launched for more than 5 months, I believe to some upgrade user who has upgraded from the previous version find the newer version has some great features that previous version doesn't have; of course, there are some minor issue that they may find it 'stupid' comparing to the earlier version (or rather more refined steps). Overall, the newer QuickBooks 2009/10 Asia does provide an easy to use navigating tool that helps user to navigate around QuickBooks accounting software.

For the next coming blog posts I am going to introduce some great features in this new QuickBooks 200/10 Asia.

First, I could like to introduce the 'Home' page of QuickBooks 2009/10 Asia. Although, personally I don't really use the Home page most of the time (I prefer to use either the Navigation bar or Menu bar) but it does provides the user (especially for those who are new to QuickBooks) with an easy to use flow chart for their accounting process.

In the Home page, it divided the accounting function into 5 sections. They are Suppliers, Customers, Employees, Company and Banking.

At the left hand side, it starts with a Supplier work flow that consists of Purchase Orders, Receive Inventory (both with and without Bills), and Enter Bills against Inventory, Enter Bills & Supplier Credits, Pay Bills and Mange Tax (G.S.T.).

In the Customers work flow, it consists of Sales Orders, Estimate, Invoices, Receive Payments, Enter Daily Sales (Cash Sales Receipt), Statement charges, Statements (Statement of Account) and Refund & Adjustment (Credit Note).

In the Employees section, it allows user to access the Payroll Centre, Enter Time (Time Sheet for recording time spend on project/job), Pay Employees and Pay Liabilities.

Company section is the core area that consists of Chart of Accounts, Items & Services, Build Assemblies, and Adjust Quantity on Hand and Audit Company feature (This is a process for year-end closing).

Banking section (some people refer it as a Cash Books) that consists of Banking feature such as Record Deposits, Write Cheques, Print Cheque (not for Singapore user), Reconcile (Bank Reconciliation) and Cheque Register (Bank Register).

At the far right, it consist of Account Balances that shows a Summary of all your bank balances (if you have the access right to bank account), a Get Started function to help new user to customize the QuickBooks and a Learn about Services (not for Singapore user) that links to Australia Quicken Services.

This Home page is a simple work flow for the accounting process; as a new user in QuickBooks, you can follow the ‘arrows’ to navigate from one function to the other. In short, just follow the arrows; you will never get loss in QuickBooks.

Join my QuickBooks training to explore how QuickBooks accounting software can simplify your accounting process.