Re: [GNC] best accounting practice for refund

It took me a while to respond as I was on holidays :) First off, I can't read the second screenshot, so I don't know what's in there. In your first screenshot I see three transactions: 1. An "Invoice type" (I) transaction, named Credit Note 2019 (don't worry about it being called "Invoice type"

Re: [GNC] best accounting practice for refund

Hi Bumping this thread to see if anyone has an idea how to proceed. > On Jul 16, 2019, at 10:43 AM, Eric Rathhaus (general) > wrote: > > Any thoughts on how to proceed? > >> On Jul 13, 2019, at 4:17 PM, Eric Rathhaus (general) > > wrote: >> >> Hi Geert - You’r

Re: [GNC] best accounting practice for refund

Any thoughts on how to proceed? > On Jul 13, 2019, at 4:17 PM, Eric Rathhaus (general) > wrote: > > Hi Geert - You’re correct about what happened. However, I can’t see how to > change the offset. The transactions appear as follows in my AR account > > > > The only place I can see to

Re: [GNC] best accounting practice for refund

Hi Geert - You’re correct about what happened. However, I can’t see how to change the offset. The transactions appear as follows in my AR account The only place I can see to reduce theis the payment transaction before gnu automatically sends the amount from AR to liabilities. But I can

Re: [GNC] best accounting practice for refund

As guess as to what might have happened: When you select the invoice and credit note in the payment window, gnucash will automatically calculate the difference between them and set the payment or refund field to that amount. That is, it assumes you intend to fully "pay" for all the documents sel

Re: [GNC] best accounting practice for refund

You’re welcome. Glad to help any time. > On Jul 4, 2019, at 12:50 AM, Eric Rathhaus (general) > wrote: > > Thanks, Adrien for your assistance and patience. > >> On Jul 3, 2019, at 10:35 PM, Adrien Monteleone >> wrote: >> >> Short answer — yes. >> >> Slightly longer answer — figure out wh

Re: [GNC] best accounting practice for refund

Thanks, Adrien for your assistance and patience. > On Jul 3, 2019, at 10:35 PM, Adrien Monteleone > wrote: > > Short answer — yes. > > Slightly longer answer — figure out what caused that to happen, undo it, and > then redo the payment properly. > > The reason for doing so rather than just

Re: [GNC] best accounting practice for refund

Short answer — yes. Slightly longer answer — figure out what caused that to happen, undo it, and then redo the payment properly. The reason for doing so rather than just creating a correcting entry is so that you learn what went wrong and don’t repeat the same situation in the future. (you’d a

Re: [GNC] best accounting practice for refund

So I did assign the credit note to the AR account and then processed two payments by selecting the posted invoices and the credit note all in the AR account. I didn’t do anything else but somehow the remaining balance of the credit note ended up in a liability account. Should I just move it bac

Re: [GNC] best accounting practice for refund

If you didn’t involve a liability account initially, the remaining credit on the credit note would sit in AR. But if you ‘paid’ the credit note with a liability, you transferred that amount from AR to the liability, which is the account you will ‘pay’ future invoices from when offsetting with th

Re: [GNC] best accounting practice for refund

On 6/26/19 8:51 PM, Eric Rathhaus (general) via gnucash-user wrote: In the past I created a credit note under the special job and sent my client a check. This year they want me to use the credit to offset invoices for subsequent work. I like the idea of creating a credit note under the specia

Re: [GNC] best accounting practice for refund

Hi again - so everything worked the first time. I back off all the transactions and put the credit note in the AR account, selected two invoices and the credit note , credit note reduced by that amount and the payments showed. But I need to run another offset and the credit note no longer appe

Re: [GNC] best accounting practice for refund

No, No, No. Two different methods/systems. (I see my earlier apology for confusion was foresight) EITHER you transfer the credit from AR to a liability account and pay from it, (really, only if a local CPA says you should) OR, you leave the credit note open till needed. (the sane and easy met

Re: [GNC] best accounting practice for refund

So when I did my way, the liabilities account is reduced by the invoice doesn’t;t show the payment. Grr. So you’re suggesting leaving the credit n the AR account, which is held as a liability? But then how to I pay future invoices from it? > On Jun 28, 2019, at 12:32 PM, Adrien Monteleone >

Re: [GNC] best accounting practice for refund

That’s one way to do it. Or, the simpler way is leave the credit note outstanding and use it to offset an invoice when needed. Regards, Adrien > On Jun 28, 2019, at 1:58 PM, Eric Rathhaus (general) > wrote: > > Thanks. > > I followed your instructions but the credit note when printed appear

Re: [GNC] best accounting practice for refund

Thanks. I followed your instructions but the credit note when printed appears as an invoice to my client with the credit showing as an amount owed. In my accounts it does appear as a “payment” in my AR account. I’m a little confused as to steps 2 and 3 now. If I understand you, I will proce

Re: [GNC] best accounting practice for refund

Nope. 1. Create the credit note and assign the line items either back to the same original income account(s) used, or to a new one along the lines of “Returns & Allowances” or “Refunds” or something similar if you want to keep track of this separately. (this is considered a ‘contra account’ bec

Re: [GNC] best accounting practice for refund

Something didn’t;t work. I created a credit note for the client and created a new account “Credit Prepayments) under Liabilities. When creating the note, instead of selecting an income account, I selected the new liabilities account and then posted the note. I then tried to process a payment

Re: [GNC] best accounting practice for refund

Thanks! > On Jun 26, 2019, at 7:41 PM, Adrien Monteleone > wrote: > > In that case, certainly, you need to use credit notes. > > I don’t see any reason why this ‘wouldn’t work from an accounting standpoint’ > but if you find a problem, instead of cutting a check to the customer as > payment

Re: [GNC] best accounting practice for refund

In that case, certainly, you need to use credit notes. I don’t see any reason why this ‘wouldn’t work from an accounting standpoint’ but if you find a problem, instead of cutting a check to the customer as payment for the credit note, combine this with option #2 I listed, and this time, use tha

Re: [GNC] best accounting practice for refund

Hi Geert - I already issued the invoices and processed my clients payments against the invoices. These payments are for filing fees to the US government for which I subsequently cut checks. I created a job for this client that I use to invoice these fees alone. The size of the filing fees is t

Re: [GNC] best accounting practice for refund

You’re welcome. That would work for existing excess pre-payments that were already applied to an existing invoice. But for future such cases, probably option #3 would be the simplest unless you really need to issue credit notes for some reason. I guess otherwise, it is a personal preference. R

Re: [GNC] best accounting practice for refund

Thanks Adrien. I think option 1 sounds best as it is one client with multiple jobs. > On Jun 26, 2019, at 12:52 PM, Adrien Monteleone > wrote: > > You have at least 2 options I can think of at the moment: > > #1 - continue to issue credit notes in your system, but don’t send them out > or

Re: [GNC] best accounting practice for refund

Thanks, Derek. But the refund comes from several jobs for which I sent one invoice in advance to cover costs. Subsequently those costs were not incurred for some but not all the jobs. And how does the credit note get accounted for when using the sum to pay for future invoices? > On Jun 26, 201

Re: [GNC] best accounting practice for refund

Yes, that’s more along the lines of what I thought a credit memo would fit for. That said, there are cases in which a client pays full rate for one session, then decides to convert to a package of sessions. I record the “ex post facto” discount to apply to that first session as a credit memo and

Re: [GNC] best accounting practice for refund

The way I understand your scenario I believe you can model what the customer does almost one to one into gnucash actions. 1. Customer prepays for expenses -> Create a payment for that customer using Business->Customer->Process Payment You can choose to map this payment to outstanding invoices or

Re: [GNC] best accounting practice for refund

Thanks Tim, I forgot about that method, so: #3 - enter a payment from a customer without choosing an invoice to post it against. GnuCash will retain that amount as a pre-payment you can apply later as needed. (same procedure as outlined in #1) Individual customer balances are available from th

Re: [GNC] best accounting practice for refund

You would only need a credit note if a client cancelled their contract and wanted (part of) their deposit back. -derek Sent using my mobile device. Please excuse any typos. On June 26, 2019 10:21:56 PM Tim Quinn wrote: Many of my wife’s tutoring clients will prepay for several sessions (to get

Re: [GNC] best accounting practice for refund

Many of my wife’s tutoring clients will prepay for several sessions (to get scheduling preference and a slight price discount). I create a separate invoice for each client visit (that way the customer report shows the payments and individual sessions nicely), and after posting each invoice I pay

Re: [GNC] best accounting practice for refund

You have at least 2 options I can think of at the moment: #1 - continue to issue credit notes in your system, but don’t send them out or pay them with a check. When you have the next positive invoice, ‘pay’ a portion (or all) of that invoice with the credit note. Simply process a payment, select

[GNC] best accounting practice for refund

Hi - I have a client for whom I have many jobs. On some of these jobs, the client prepaid expenses that I did not use. In the past, I’ve always created a credit note for a refund and sent the client a check. However, my client prefers instead that I credit this amount towards future work. I’