Clearing Unapplied Payments

Scenario 1

Customer #1 had $500.00 posted as unapplied Cash. The $500.00 should have been posted to Customer #2 instead of Customer #1.

  1. On the Accounts Receivable menu click Customer Balance Posting.
  2. Create an invoice for Customer #1 for $500.00.
    Remember, this does not affect the General Ledger.
    The invoice number is a number you make up that has not been used before.
  3. Create an invoice for Customer #2 for a negative amount of ($500.00).
    Again, this does not affect the General Ledger.
    The invoice number is a number you make up that has not been used before.
  4. On the Accounts Receivable menu, click Payments.
  5. Click the Unapplied Payments button and select the Customer #1 with the Unapplied Cash.
  6. Notice the Amount Left is now the amount of the Unapplied Cash.
  7. Apply the Unapplied Cash to the invoice that was created in Customer Balances and save the record.
  8. Select Customer #2 (the customer that the money should have been posted to).
  9. Choose the Negative invoice that was created in Customer Balances and then select the Invoice to be paid.
  10. Update to the General Ledger.

Scenario 2

Unapplied Cash is on a customer’s account and you want to keep the Unapplied Cash. There are two different ways to accomplish this:

Use Customer Balance Posting to add an invoice record without affecting the General Ledger.

  1. On the Accounts Receivable menu click Customer Balance Posting.
  2. Create an invoice for the customer for a positive amount of Unapplied Cash.
    This does not affect the General Ledger.
  3. On the Accounts Receivable menu, click Payments.
  4. Click the Unapplied Payments button and select the customer with the Unapplied Cash.
  5. Notice the Amount Left is now the amount of the Unapplied Cash.
  6. Select the Invoice created in Customer Balances and apply the Unapplied Cash to the invoice.
  7. Update to the General Ledger.
  8. On the WinTeam Menu, click General Ledger, and then click Adjusting Journal Entries.
    The General Ledger was not effected by the above transaction.
  9. Enter a Journal Entry using the following:
    Debit: A/R Trade Account Number Example 1101
    Credit: Miscellaneous Income Example 3599

This bypasses having to use Customer Balance Posting and General Ledger, Adjusting Journal Entries. Instead, creating an Invoice for the customer can accomplish the same thing. If you are going to use this option, make sure that you mark the Invoice Status as "Do Not Send" since you will not want to send this invoice to the customer.

  1. On the Accounts Receivable menu click Invoice Entry.
  2. Create a new invoice for the customer for a positive amount of Unapplied Cash using an Item Number that pertains to the General Ledger number you want to credit. The item number selected will pull the associated Income Account GL # set up with the Item's Category.
  3. Change the Invoice Status to Do Not Send.
  4. Update to the General Ledger.
  5. On the Accounts Receivable menu, click Payments.
  6. Click the Unapplied Payments button and select the customer with Unapplied Cash. The Amount Left is now the amount of the Unapplied Cash.
  7. Select the Invoice created to clear this Unapplied Cash amount.
  8. Update to the General Ledger.

Scenario 3

Unapplied Cash is on a customer’s account and you want to return the amount to the customer.

  1. Set the Customer up as a Vendor.
  2. On the Accounts Receivable menu click Customer Balance Posting.
  3. Create an invoice for the customer for a positive amount of Unapplied Cash.
    This does not affect the General Ledger.
  4. On the Accounts Receivable menu, click Payments.
  5. Click the Unapplied Payment button and select the customer with the Unapplied Cash.
  6. Notice the Amount Left is now the amount of the Unapplied Cash.
  7. Select the Invoice created in Customer Balances and apply the Unapplied Cash to the invoice.
  8. Update to the General Ledger.
  9. On the WinTeam Menu, select Accounts Payable, and then click Invoice Entry.
  1. Enter an Invoice for the amount of the unapplied cash.
    Debit: A/R Trade Account Number Example 1101
  2. Print a check for this vendor and mail them the check.

See Also:

Applying Unapplied Payments