QB Issue Resolution:

A customer credit memo, because intuit does NOT follow accounting procedures, holds that credit memo in the A/R account, lowering the balance. Depending on the total of outstanding invoices, the balance sheet could show a negative amount for A/R, and will definitely show a low value if not. Good luck explaining that to a banker or auditor.

 

The directions you copied and pasted are incomplete. customer credit memo’s require the use of items, yet you gloss over that with no directions on what item to create or how to link it so it works.
Select Credit memo.
Select the customer in question under the Customer drop-down menu.
Fill up the form as necessary.

 

@Bart57

Booking the advance as a liability is correct.

Create a service type item, name it retainer or something and link it to the liability account (under income account selection)

 

Fill out your invoice, and as the last item, use the
retainer item, qty = -1, enter the amount (that is a negative one in qty)

 

That will apply the amount to the invoice, sales income will be correct, the liability account will be reduced by the amount entered. And if there is a balance owing the customer pays that.

 

Resolution for Issue 'Hi, I’ve received approx. 50k beginning of the year from a Customer as Cash Advance to cover costs of my operations. In return for services rendered, we can now send an invoice for approx. 40k. I want to offset the Cash Advance with the invoice (so there is still a 10k cash advance left as liability). I booked the original deposit as a current liability, but I cannot seem to offset my invoice with this account…? The invoice automatically books A/R (Debit) and Sales (Credit) Do I need to do this with a manual entry? How would that work? Any suggestions would be appreciate, because I can’t seem to find a solution to this problem. I’m not a full time accountant…start-up life :/' available: Yes (Solved).
Source: Intuit Community forum.

Hi, I’ve received approx. 50k beginning of the year from a Customer as Cash Advance to cover costs of my operations. In return for services rendered, we can now send an invoice for approx. 40k. I want to offset the Cash Advance with the invoice (so there is still a 10k cash advance left as liability). I booked the original deposit as a current liability, but I cannot seem to offset my invoice with this account…? The invoice automatically books A/R (Debit) and Sales (Credit) Do I need to do this with a manual entry? How would that work? Any suggestions would be appreciate, because I can’t seem to find a solution to this problem. I’m not a full time accountant…start-up life :/: this issue or error code is a known issue in Quickbooks Online (QBO) and/or Quickbooks. Support for this issue is available either by self-service or paid support options. Experts are available to resolve your Quickbooks issue to ensure minimal downtime and continue running your business. First try to resolve the issue yourself by looking for a resolution described below. If it is a complex issue or you are unable to solve the issue, you may contact us by clicking here or by using other support options.

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