Friday, January 23, 2009

An Enterprise user asks how to fix Vendor bill payments that were recorded via Write Checks instead of Pay bills.

Sometimes QuickBooks users write direct checks to pay vendors for whom they've entered bills, instead of using the Pay Bills feature. After a while, these users notice they have a very large Accounts Payable balance. In addition, expenses are higher than they should be, because the expense was posted when the bill was entered, and then posted again when you wrote the direct disbursement check.
The easiest way to correct this is to replace the direct disbursement check with a "pay bills" check, using the instructions that follow.
1) Print a Check Detail report – Reports>Banking>Check Detail. Change the date range to go back to the date when you wrote the first incorrect check.
2) Click Modify, select the Filters” tab and modify the Transaction type to show “checks”.(This eliminates the checks that were correctly written as the type Bill Payment).
3) Click OK to return to the report window, and print the report.
4) Open the Pay Bills window and begin paying the bills you already paid. Select each vendor's bill (or multiple bills if the check you wrote covered more than one bill). If you took credits when you wrote the check, be sure to use the Set Credits feature to take those credits now.
5) Change the date to match the date of the check you already wrote and sent.
6) When the bills are selected, and the amount of the check matches the direct disbursement check you wrote, select the option Assign Check No. at the bottom of the Pay Bills window.
7) Click Pay & Close (or Pay & New if you have to do this again for another check), and in the Assign Check Numbers dialog, enter the check number you used when you wrote the direct disbursement to pay the vendor's bill. When QuickBooks warns you that the check number has already been used, select “Keep Number.”
When finished open the check register. You'll find that each check number you just used appears twice, once for the direct disbursement (check type CHK), and once for the bill payment you just made (check type BILLPMT).
8) The last step is to delete every duplicate check that is of the type CHK. Your bank balance returns to its proper amount, the expense account is adjusted to reflect only the expenses you posted when you originally entered the vendor bills.

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