now that we've recorded payments and invoices we now have to apply
those payments to those specific invoices and it's very very easy
now that we've recorded payments and invoices we now have to apply those payments to those specific
invoices and it's very very easy the open invoice report is the most important report for you to
be able to tell which payments have been applied to which invoices the open invoice report should
show only the net remaining amount of either the payments that have not been used or the invoices
that have not been paid for only invoices that are not paid or only payments that are not yet
used should show up on the open invoice report not both let's take a look from the icon bar we
click open invoice now we can see that we have payments that are not completely used up and
invoices that have not yet have payments applied to those invoices this is not the way the open
invoice is supposed to look it's supposed to be only remaining payments or only invoices that
have not been paid so in the example of Allen RV instead of showing a $6,000 payment and a $1000
invoice it should not show the invoice at all it should show only 5,000 of payment unapplied and
waiting to be applied to future invoice same thing with Betty Boop it should not show 7200 in payment
it should not show 1200 of invoice it should show only a $6,000 remaining payment waiting
to be applied so how do we do that well we have to choose which payments to apply to which invoices
we will apply them in date order because we get several payments and we make several invoices and
we assume the earliest invoices will be paid for by the earliest payments now it's very simple to
apply payments to invoices you can double click the invoice that obviously has not yet had a
payment applied to it because it's still here on the open invoice report when you double click you
can go up to the ribbon and in the main tab of the ribbon one of the choices is apply credits
so when you click apply credit you will see all of the payments and all of the credits that have
been received by or given to this particular client Allen RB in this case there's only one so
QuickBooks has automatically selected it because it knows if this is the only payment on the list
to a possibly apply to this invoice then it can be the only one so QuickBooks placed the check
mark here in a situation where you have several payments you would have to click in the margin to
put the check mark on the particular payment that you were applying to this invoice when we click
done and then we click Save and close we go back to the open invoice report and we see the open
invoice report now looks the way it's supposed to look in regard to Allen RB instead of having two
transactions not applied to each other we have just the net amount so the only open thing for
Allen is this payment in the amount of $5,000 for for future services we can do the same thing for
Betty Boop double click and then in the main tab of the ribbon click apply credits she only
had one payment that could possibly be applied to this invoice so QuickBooks placed the check mark
here but if there were several you would have to click the check mark and choose the payment
that's being applied to this invoice click done click Save and close and now Betty Boop's SEC's
the open invoice looks correct she has a net remaining amount of $6,000 from a payment on
January 1st that has not yet been used up you can even apply a past payment at the moment you
make an invoice for example February 9 did the remaining 2nd court appearance for candy Charles
and earned the remaining 1200 from her payment on January 5th so that means we will have to make an
invoice an additional invoice for candy Charles we open the invoice window we make it February 9th of
2017 and of course the client is candy Charles and the QuickBooks puts invoice number 4 in our
case we put everything into fees earned because we don't track our income and the amount earned
on February 9th was 1200 now even before we push save and close we can click apply credits and then
click yes and then we see again this $2,400 payment is the only payment on this list so
QuickBooks has already placed the checkmark here we can click done and save and we see that the
invoice we just made on February 9th did not even show up on the open invoice report because it was
paid and the payment was applied at the moment we recorded it unfortunately we can't have this
Candy's balance is 0 so there should be nothing in the open invoice for candy so we can double
click the old invoice click apply credit you see there's only a $1,200 credit from a payment left
over from January 5th it's already selected so click done and save and now candy Charles is not
showing up at all on the open invoice report and she should not and the open invoice report looks
if you ever need to see any of Candy's past transactions you can always open up the client
balance detail and you can see the entire activity and every payment and every invoice for candy if
you need to see how past payments were applied to past invoices you can look at the transaction
history of the invoice to see what payments have been applied to what invoices so every invoice has
a payment history and the best place to find all your invoices is on the customer balance detail
because if they're already paid and payments have been applied they won't show up on open invoice
so we open the customer balance detail you can quote the clients balance detail and let's pick
any of these invoices for example this payment here with can't for invoice number 3 with candy
double click now because this invoice has already been paid it has a paid sticker right here and it
even tells you the date of the payment that was applied to this invoice however in the reports
tab of the ribbon you can click transaction history and you will get a list of every single
past payment that was applied to this particular invoice this transaction history window will show
you all the payments in date order and it will show you the running balance of this specific
invoice the other way to do it is to actually open up the payment to see how the invoices
were applied so for example if I double click this particular payment for candy Charles I can
see that the payment she made on January 5th was applied to the invoice that was made on February
2 and also applied to the invoice that was made on February 9 you should also know that you can
use the payments window to uh apply or reapply a payment to a different invoice now if you want to
really be an expert on how to do that you can see the supplemental videos provided in this course