I work for a printing company that has a barter arrangement with their accountant. I’ve received their bill for the companies year end which includes the barter credit. How do I record this in QuickBooks as I need to clear out the outstanding invoices in QuickBooks and pay the amount less the credit?
For this example we are going to use the following information:
Sea Point Accounting
Credit on file (818.80) (barter)
Net Due $4,266.20
1. Make sure all the invoices to the accountant are already entered in QuickBooks. For this example we are looking at all the invoices that make up $818.80.
2. Enter the bill from accountant into QuickBooks. You need to enter the actual amount of the bill before the credit was taken off. In this case enter the bill in the amount of $5,085.00.
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3. Pay the net amount due $4,266.20. This now leaves the outstanding amount $818.80.
4. Next we are going to use the bank account Clearing to clear out those Open Invoices. If you do not have a clearing account setup, go ahead and create a new bank account called Clearing.
5. Go to Receive Payments. Select all the invoices that make up the barter amount – $818.80.
6. Receive the payment to the Clearing Account. Don’t worry about Pmt Method area – ignore.
7. At Pay Bills – write cheque from the Clearing Account.
8. Enter the word ‘Barter’ at the Assign Cheque Numbers window.
9. Next step is to reconcile the Clearing account to zero.
10. From the menu bar click on Banking – Reconcile. Select the Clearing account.
11. Enter the date. Enter 0 (zero) for Ending Balance. Beginning Balance will be 0 (zero). Click Continue.
12. The Reconcile screen now displays the payment and deposit.
13. Select the payments – make sure Cleared Balance shows 0 (zero) and click Reconcile Now.
14. Barter complete -Open invoices cleared.