and now we will see what happens when we record arbitrary payments from customers an arbitrary
payment is when the amount of the payment does not match any of the invoice amounts it also means the
customer did not tell us which invoice he or she wanted to pay the default for applying unmatched
payments is date order this means that payments are applied to the oldest invoices first any
remainder gets applied to the next oldest invoice for example imagine on January 20 we received only
$1,000 from Betty with cheque number 5 6 7 8 Betty did not tell us what invoice she would like this
payment to be applied to however there is no exact match of $1,000 for any of the invoices that Betty
owes us when we take a look at the open invoice section just for Betty we see that the oldest
invoice has a balance of $1,400 so if Betty pays us $1,000 it will automatically be applied to this
one invoice number 2 on the top because that is the oldest one and there is no exact match
of $1,000 after we record the payment of $1,000 invoice number 2 will still be on the open invoice
report because it is not completely paid she only paid a thousand out of the 1,400 but if she pays a
thousand out of the 1,400 the balance of invoice number 2 will become four hundred dollars let's
take a look how to record the payment once again January 20 received a thousand-dollar check from
Betty number 5 6 an8 from the main menu click customers receive payment the date is back on
January 20 via the cut of that payment method is check number five six seven eight the customer is
Betty now she only has three open invoices but sometimes you can't really see the panel unless
you close the ribbon this way you can be sure to see all your invoices the money amount is a
thousand dollars at the moment you push the tab he QuickBooks will automatically put a checkmark
on the oldest invoice that's because there is no exact match of a thousand dollars and the oldest
invoice is here on the top so the amount due is one thousand four hundred the payment amount is
a thousand when we click Save and close we can see the open invoice report for Betty now shows
that invoice number two is still open but only four hundred dollars remains unpaid now that we
know how payments are applied automatically we have to ask what if the payment amount is more
than the oldest invoice for example January 21 we receive four thousand dollars from Alan with
check number nine zero one two well in Alan's case the oldest one is only three thousand dollars the
oldest one will disappear from the open invoice report because it will be completely paid off the
next oldest one will decrease by the amount of excess the remaining amount of $1,000 will pay
off the second oldest one lowering the amount that we owe so this is what Alan's open invoice report
looks like before we were toward the 4,000 dollar payment 3000 out of the 4,000 will pay off the
oldest one and the oldest one will disappear the excess remainder of a thousand will be applied to
the next oldest one and it will change from three thousand nine hundred dollars to two thousand nine
hundred dollars unpaid and this is what the open invoice report will look like for Alan after we
record that payment once again January 21 received 4,000 from Alan with check number nine zero one
two from the main menu we will click customers receive payment of course the Methodist check
check number nine zero one two the date is January 21 the customer is Alan now notice you cannot
see all of Alan's open invoices unless you scroll down unless you move the mouse to the right of the
center panel and scroll down you will not see all of Alan's invoices you might not have to scroll
down if you close the ribbon and you open up the panel because you will have more space now we will
type in the money amount 4000 look what happens at the moment we push the tab key notice two check
marks appear the check mark here completely pays off the first invoice and puts $3,000
in the row of invoice number one the remaining excess of $1,000 you can see clearly is applied
to invoice number five so this one is paid off it will disappear and 3900 becomes 2,900 because the
excess of a thousand is applied when we click Save and close and we look at the open invoice for Alan
we see now Alan only has three open invoices the top one for 3,000 has disappeared and the
second-oldest one you can see has decreased to $2,900 let's finish this video by putting the
receive payment window into the icon bar from the main menu click customers receive payment you can
see receive payment is now the active window so again move to the top left of the main menu
and click view and receive payments to the icon bar and of course when we click OK the payment
icon is there now we can open it up without having to remember where it is in the main menu