[GNC] Best way to close unpaid invoices?
Daffy Duck
suffsuccotash at gmail.com
Mon Mar 8 22:05:25 EST 2021
Ok, maybe that is the issue.
AFDA is not listed under transfer accounts. Both AR and AFDA are not
listed.
?
On Mon, 2021-03-08 at 20:55 -0600, Adrien Monteleone wrote:
> Sorry if I wasn't clear.
>
> At first, there should be no transactions in that account.
>
> Go to Business > Customer > Process Payment.
>
> Enter the customer in the search field at the top.
>
> You'll see the invoice that you need to close out, select it.
>
> Put in the appropriate date, and the amount you are charging off to
> Bad
> Debts. (eventually)
>
> Select the Allowance for Doubtful Accounts (AFDA) account as the
> Transfer Account.
>
> Put a memo if you like.
>
> Then save the 'payment'.
>
> After that is done, the invoice will be closed out as 'paid' by AFDA.
>
> This then needs to be expensed, so in AFDA enter a transaction for
> the
> same amount as the 'payment' but this time between AFDA and
> Expenses:Bad
> Debts.
>
> Not sure if you are using formal labels or not, but the result of the
> payment will be:
>
> Dr. Allowance for Doubtful Accounts (left column)
> Cr. Accounts Receivable (right column)
>
> The charge off will be:
>
> Dr. Expenses:Bad Debts (left column)
> Cr. Allowance for Doubtful Accounts (right column)
>
> AFDA will now be zero.
>
> Normally, this account is populated at the beginning of an accounting
> period with a reasonable estimate of what you won't collect. It is
> then
> converted to charged off expense at the end of that period, or
> monthly,
> whichever you need or works for you.
>
> Of course, you can make specific adjustments like this one as needed.
>
>
> Regards,
> Adrien
>
> On 3/8/21 8:25 PM, Daffy Duck wrote:
> > Hi,
> >
> > Thanks.
> >
> > "For Bad Debts, set up an account called "Allowance for Doubtful
> > > Accounts" as a child of AR. (be sure to make this of type
> > > 'Asset')
> > >
> > > You can then 'pay' the invoice using this account as the source.
> > >
> > > This will cause the invoice to be closed by GnuCash and it will
> > > be
> > > removed from the Due Invoices Reminder."
> >
> > This does not work. I created an asset account under "Accounts
> > receivable" and I put the entry in for the $500, an increase.
> >
> > I then tried to assign it as a payment to the invoice. It said
> > "you
> > must select a transfer account from the account tree."
>
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