Write Cheque Function Used Incorrectly
I recently was hired by a company that has been trying to do its own books for the last 2 years. I was brought in to fix them and bring them up to date. One of the scenarios I'm encountering is cheques being written using the Write Cheques function in Quickbooks when there is a bill payment due, I've tried following the advice on here.
- select cheque, change to AP from Expense, with vendor listed in the memo field.
- then going to pay bills and applying credit
the problem with this is that the credit is only for the cost of the item and the PST, leaving the GST still owing...
HELP! I'd really like to stay with this company but I don't know how to fix this.
You have to correct your sales tax code. Accounts Payable does not have a sales tax code because the sales tax was accounted for with invoice. The input sales tax credit has actually been claimed twice if the invoice was input to Enter Bills and Write Cheques. So you have to be careful here if the ITCs have been included in a filed GST/HST report.
You've got some options.
Can you post back here and let me know ... if the bank reconciliations have been done? Were the GST/HST reports filed based on a hand calculation or using the QuickBooks information, in effect claiming ITCs twice? Were the tax returns prepared using this information? Was the "close" function ever used?
Once I have a bit more information on where the books are at and what has been filed using the information, we can talk about how to approach your problem.
There is always more than one way to do things in QuickBooks.