Vendor payments

Question

I started paying vendor bills directly from my checking account, using Categories.  The vendor accounts do not show the payments.  How can I now link the payments to the Vendor accounts  Going forward, should the payments be made from the vendor account?

Ralph Gillis · Answer

Got it!  Where is your chart of accounts.  Since we are budgeting a construction project we could use that list for the construction trades that we need to budget and track.

UKR · Answer

Recategorize these checking account transactions as transfers to the Vendor Invoices account, making sure that the Payee Name exactly matches the Payee Name on your Vendor Invoices.

This will not mark each vendor's invoices as paid right away, but the money will flow to the vendor invoices account as a Credit or Refund.

Next time you pay a new vendor invoice, in the New Payment dialog (see my image above) you will see that there is an amount reflected in "Existing Credits". Put a checkmark in the "Apply existing credits" box and, when you save the transaction, all old vendor invoices will have been marked as paid (from the credits).

(If you never have new payments to a vendor, but you still have unpaid vendor invoices, just create a $0.00 payment to vendor transaction and "Apply existing credits". After saving, you won't see a $0.00 transaction in the register, but for this vendor you should now have a $0.00 unpaid invoices amount and all invoices are marked paid ("c" in the Clr column")).

Do be sure that all the line items in your Vendor Invoices are correctly categorized to Categories marked as taxable line items, with a category from the list of Schedule C categories.

Ditto for any line items in Customer Invoices. This ensures correct accounting for your business income and expenses.

Ralph Gillis · Answer

the invoices are in the Vendor section.  Our Categories are Trades (Masonry).  There are several vendors who provide labor or supplies for that category.   How can we now connect the payment to the vendor so the bill shows as paid?