Apply an A/R Credit to an Order
In this article we will look at applying A/R Credits and Deposits to customer Invoices. This can be done through two different methods:
- Open Sales Orders (enter via Payments tab directly on the Sales Order)
- Posted Sales Orders (enter via Receipts screen)
1. Apply a credit directly on the Sales Order
If you would like to apply a deposit/credit to an open Sales Order (i.e. not yet Posted), you can do so via the Sales Order entry screen.
- Open the Sales Order and click on the Payments tab.
- In the Apply Open Credits or Deposits section, click the + symbol to view a list of open A/R items for this Client.
1.1. Select a Document
Highlight the A/R item that you'd like to apply to this order and click Select.
- The list displays ALL open A/R balances, including deposits and credits.
- This same process can be used in the opposite direction too. If you are issuing a Credit Memo, you can choose to apply an open Invoice balance due to the credit Invoice.
1.2. The A/R Credit has been applied.
When the credit is applied, you will see the item in the list and the Balance Due will be recalculated.
If you have more credits to apply, you can keep doing so as many times as you need.
1.2.1. What if deposits or credits have been over-applied?
In some cases, the amount of the deposit you are applying may exceed the order total. When this happens, double-click on the deposit to change the amount to apply.
2. Apply a credit via the Receipt window
There may be an occasion where you need to apply a credit to an open A/R balance due after the Sales Order has been posted. In this case you will accomplish this via the Receipt window. The process is basically the same as standard Receipt entry, with some exceptions depending on how complex of a situation you are dealing with.
- Enter the Receipt amount. In this scenario, the A/R credit exceeds the value of the invoice so we can enter a $0.00 Receipt.
- Enter the debit (credit) amounts in the Applied column of the detail area.
- You'll know you were successful when the Distribution remaining = $0.00.