Of course, here is a detailed and lengthy post on how to pay an invoice on Intuit QuickBooks.
How to Pay an Invoice on Intuit QuickBooks: A Complete Guide
Welcome! If you're a business owner, a freelancer, or a bookkeeper, you've likely encountered the need to pay an invoice. And if you're using QuickBooks, you've got a powerful tool at your fingertips to make that process smooth and organized. Let's dive in and get you started on a clear, step-by-step path to paying your bills.
Step 1: Get Ready to Settle the Score
Alright, let's get down to business! Before you even log into QuickBooks, grab the invoice you need to pay. What's the most important thing you need to know from it? You got it: the total amount due, the due date, and the vendor's name. Make a note of these details. Now, let's open up QuickBooks and get ready to work our magic.
Step 2: Entering the Bill into QuickBooks
This is the crucial first step within QuickBooks. You need to record the invoice as a "bill" so that it's properly tracked in your accounting records. This is a critical part of accrual accounting, which helps you see a more accurate financial picture of your business.
Sub-heading: Using the 'New' button
Click the ' + New' button: You'll find this button in the top left corner of your QuickBooks dashboard. It's your gateway to creating new transactions.
Select 'Bill': A dropdown menu will appear with various options like 'Invoice,' 'Expense,' 'Bill,' etc. For a vendor's invoice that you need to pay later, you'll choose Bill.
Sub-heading: Filling out the Bill Details
Now, a new window will open where you'll enter the invoice information.
Vendor: From the dropdown menu, select the vendor who sent you the invoice. If the vendor isn't in your list yet, you can add them right there by clicking '+ Add new'.
Terms: This is the payment term specified on the invoice, for example, "Net 30," "Due on receipt," or "Net 15." Selecting the correct term helps QuickBooks calculate the due date automatically.
Bill date: This is the date the invoice was issued.
Due date: This date will populate automatically based on the terms you selected. Double-check it against the invoice to make sure it's accurate.
Bill No.: Enter the invoice number from the invoice you received. This is crucial for matching the payment to the bill later.
Category/Items details: This is where you specify what you're paying for.
Category Details: If it's a general expense like utilities or office supplies, you'll select a category from your Chart of Accounts (e.g., 'Utilities Expense,' 'Office Supplies').
Item Details: If the payment is for a product or service you're reselling, you'll select a product or service item you've already set up.
Amount: Enter the amount for each line item.
Memo: Add a brief memo for your records, such as "Payment for June electricity bill."
Once all the details are entered, click Save and close or Save and new if you have another bill to enter.
Step 3: Finding the Bill to Pay
Now that the bill is in QuickBooks, you can find it and pay it. There are a couple of ways to do this.
Sub-heading: Using the 'Vendors' or 'Expenses' Tab
Navigate to 'Expenses' -> 'Vendors': On the left-hand navigation bar, click on Expenses, and then select Vendors. This will show you a list of all your vendors and their balances.
Select the Vendor: Find the vendor whose bill you want to pay.
View the Transaction List: You'll see a list of transactions with that vendor, including the bill you just entered. You can click on the bill to open it and review the details.
Sub-heading: Using the 'Bills to Pay' Report
A great way to see all your outstanding bills is to run a report.
Click on 'Reports': On the left-hand navigation bar.
Search for 'Unpaid Bills': In the search bar, type 'Unpaid Bills' and select the report. This will give you a list of every single bill that's currently owed.
Step 4: Making the Payment
You've found the bill, now let's pay it!
Sub-heading: Selecting the Bill and Creating a Payment
Click 'Make Payment': From the vendor's transaction list or the 'Unpaid Bills' report, you'll see an option to Make Payment. Click it.
Select the Bill: A new window will appear showing you all the outstanding bills for that vendor. Select the bill you want to pay by clicking the checkbox next to it.
Payment Account: Choose the bank account or credit card from which you are making the payment. This is very important for reconciliation.
Payment Date: Enter the date of the payment.
Payment Method: Select the method of payment (e.g., 'Check,' 'Credit Card,' 'ACH,' 'Bank Transfer').
Ref. no. (optional): If you're paying by check, enter the check number here.
Sub-heading: The Final Clicks
Save and close: This will record the payment and close the window.
Save and print: If you need to print a physical check or a record of the payment.
Congratulations! You have now successfully paid an invoice and recorded the payment in QuickBooks. The bill will be marked as "Paid," and the corresponding amount will be deducted from your bank account or added to your credit card balance in QuickBooks.
10 Related FAQ Questions
How to track my unpaid bills in QuickBooks?
You can track your unpaid bills by navigating to Expenses -> Vendors and viewing the list of vendors with outstanding balances. You can also run the 'Unpaid Bills' report from the Reports section.
How to pay a bill with a credit card in QuickBooks?
When you are making the payment for a bill, in the 'Payment account' field, simply select the credit card account you want to use instead of a bank account.
How to enter a partial payment for a bill?
When you go to 'Make Payment', you can change the payment amount to a partial amount instead of the full amount. The remaining balance will show as unpaid on the bill.
How to apply a vendor credit to a bill?
When you go to pay a bill for a vendor who has a credit, QuickBooks will automatically show you a notification that a credit is available. You can select the credit to apply it to the bill and reduce the payment amount.
How to pay multiple bills at once?
When you click 'Make Payment', the window will show you all outstanding bills for that vendor. You can select the checkboxes for multiple bills and pay them all in a single transaction.
How to mark a bill as paid outside of QuickBooks?
If you paid a bill offline (e.g., with a physical check) and just need to record it in QuickBooks, you can enter the payment by following the steps above. Just ensure you select the correct payment account and date, and add the check number in the reference field.
How to void or delete a bill payment?
Go to the vendor's transaction list, find the payment you want to void or delete, and click on it. You can then select 'More' at the bottom of the screen and choose 'Void' or 'Delete.' Be careful, as this cannot be undone.
How to set up recurring bill payments?
You can set up a bill to be recurring by opening the bill and clicking 'Make recurring' at the bottom of the screen. You can then set the frequency (e.g., monthly, weekly) and save it.
How to categorize a bill for a specific project or customer?
When entering the bill, you can use the 'Customer/Project' column in the Category details section to link the expense to a specific customer or project. This helps with job costing and profitability analysis.
How to see my bill payment history for a specific vendor?
Go to Expenses -> Vendors, select the vendor, and you will see a complete list of all transactions, including bills and bill payments, in chronological order.