nav[aria-label="Primary Navigation"] { padding: 0; & ul { list-style: none; width: 100%; display: flex; flex-direction: row; justify-content: start; align-items: start; gap: 30px; padding: 0; & li { margin: 0; } & ul li { list-style: none; } } }

Partial Payment Recognition Complication

JoelC

As a start, the solution is not as easy or simple as simply recognizing the partial invoice payment with the balance remaining as an outstanding / unpaid amount; read on.

I have a client whose invoices from me contain three different amounts / categories as follows:

Category 1 is a consulting income.
Category 2 is commission income.
Category 3 is sales tax (i.e. 10%).

The client has paid me Category 2 and Category 3 but has not paid me Category 1.

The problem I have discovered is that when I accept a partial payment such as $110, Quicken allocates the $100 proportionally to Category 1 and Category 2, allocated $10 to the taxes (i.e., Quicken does not allow me to allocated the $110 to Category 1, Category 2 and Category 3 manually).

Questions:

1. Is there a way to allocate the $110 to Category 1, Category 2 and Category 3 manually (that I missed) to achieve the desired result (i.e., $100 to Category 2 and $10 to Category 3)?

2. If there is no way to allocate the $110 to Category 1, Category 2 and Category 3 manually (that I missed) to achieve the desired result, then what is the recommended method to record the amounts received in Quicken?

Thank you.

Find more posts tagged with

Comments

UKR

Hmmm … have you thought about breaking this process into two invoices?

Invoice 1 for Consulting Income and Sales Tax
Invoice 2 for Commission Income and Sales Tax

This way you can mark invoices as paid individually.

JoelC

@UKR I have but I am not terribly exited about that idea becuase that would:

Bring the associated tax account out of sync unless there is a work around (significant issue); and
Much up the invoice numbering which, while not ideal, I could live with.

Thanks.

JoelC

Anyone, as I would really like to get this solved.

Thank you!

JoelC

Any comments / thoughts on this approach:

Accept the invoices in full.
For each invoice where there is an outstanding consulting fee, create an offsetting register entry.
For each invoice where there is an outstanding consulting fee, create a future invoice to track this amount.
When the outstanding consulting fee is paid, accept the future invoice and delete previously recognized consulting fee and offset entry.

Comments / thoughts on this approach?

Jim_Harman

That sounds reasonable, you are essentially converting the original invoice into 2 invoices after the fact.

In Step 3, you might want to give the second invoice the original date, so Quicken knows when that payment was due.

JoelC

@Jim_Harman appreciate the confirmation and fast response.

In Step 3, you might want to give the second invoice the original date, so Quicken knows when that payment was due

Hmm, I was thinking of creating one future invoice inclusive of all outstanding amounts broken into the individual amounts on a line by line basis noting:

I do not think that I need the date of the original invoice as i) I will have the offset entry so that when the amount is paid I will delete the offset entry and everything will have the correct date and ii) I will include text in the memo field to quickly identify and access the offset entries and, by extension, the due date
I was thinking that one future invoice inclusive of all outstanding amounts broken into the individual amounts on a line by line basis was preferable because it would limit the amount of invoice numbering / sequencing problems.

Comments / thoughts?

Thank you.

JoelC

@UKR

Hmmm … have you thought about breaking this process into two invoices?
Invoice 1 for Consulting Income and Sales Tax
Invoice 2 for Commission Income and Sales Tax
This way you can mark invoices as paid individually.

I dug into this yesterday and in the end opted to follow your approach which was the better solution.

I implemented it as follows for each impacted invoice:

I copied the invoice
I set the copied invoice number = original invoice number + 1000, to make the copied invoice easily identifiable and to not run into an invoicing numbering problem down to road
I modified the original invoice so that it included only the amount that had not been paid (i.e., Category 1 from the OP)
I modified the copied invoice so that it included only the amounts that had been paid (i.e., Category 2 and 3 from the OP)
I accepted / received payment of the copied invoice.

The advantage of this approach is, as both you and @Jim_Harman noted, it retains the integrity of the Category 1 amounts owing (i.e., it maintains the original invoice date, due date and can easily be matched up against the invoice sent to the client ).

With that, much thanks to the two of you for pointing me in the right direction.

Thank you.