How to write off the supplier's credit and Customer credit in 2011?

Sage 50 Accounting - Canadian Edition

Sage 50 Accounting - Canadian Edition
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How to write off the supplier's credit and Customer credit in 2011?

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My boss asked me to write off the two credit transactions in 2011. He said that they are too old. He just wants to see the custmers and suppliers report balanced.

One is credit from the supplier; the other is credit we sent to the Customer. they are not the same company.  I think that I can't  write them off.

If I touch them, they will affect accounts payable et receivable et taxes in the fiscal year 2011.

Could anyone give me some suggestions?

Thank you.

 

 

 

 

 

All Replies
  • It sounds like the credits were originally created to contra each other.

    Do you have a clearing account of some sort such as cash clearing? This will be  an account nbr in the 1000 nbr section. If so then pay the credit invoice from the supplier using the cash clearing account as the bank and also pay the credit invoice from the customer using the same cash clearing account nbr as the bank. When you look at the cash clearing account for that day you will see a debit amount and a credit amount so they offset each other.

    If you do not have a clearing account nbr then you could create one called 'Clearing Acct' in the 1000 section close to the bank acct nbr. In creating it also make sure you select the Class tab and classify it as a bank so that you will be able to pull it up thru the payment and receipt modules.

  • Hi, Smithco

    Thank you very much for your prompt reply.

    We have clearing account. If I do this, does it affect the Financial statement in 2011? e.g trial balance, and balance sheet etc.

    The two transaction are not related to each other. not the same amount and not the same company.

    Thanks again.

    smithco

    It sounds like the credits were originally created to contra each other.

    Do you have a clearing account of some sort such as cash clearing? This will be  an account nbr in the 1000 nbr section. If so then pay the credit invoice from the supplier using the cash clearing account as the bank and also pay the credit invoice from the customer using the same cash clearing account nbr as the bank. When you look at the cash clearing account for that day you will see a debit amount and a credit amount so they offset each other.

    If you do not have a clearing account nbr then you could create one called 'Clearing Acct' in the 1000 section close to the bank acct nbr. In creating it also make sure you select the Class tab and classify it as a bank so that you will be able to pull it up thru the payment and receipt modules.

     

     

  • Oh - you said "One is credit from the supplier; the other is credit we sent to the Customer. they are the same company" so I had assumed that it was the same company.

    Then no that will not work.

    You did say credit transactions - Am I correct is assuming the supplier owes you? and that you owe the customer? If that is the case then why not ask the supplier to send you a cheque for the credit invoice reason being that it does not look like you will be ordering in the next little while to cover the credit amount due.

    And why not send a cheque to the customer if you do legitimately owe the customer that money? Neither of these two option will affect the 2011 financial stmts.

  • Otherwise if your boss does not want to do this then create a debit invoice for the supplier for the same amount and code it to the bad debt expense account. Be sure to also debit the GST/HST if was used in the credit invoice.

    As for the customer credit invoice then create a debit invoice and code it to a revenue account and applying the GST/HST that was applicable at the time. You have receive money for this originally and did not refund the money back for the credit invoice so now it has to go back into the revenue account - you cannot use a bad debt expense account for this one.

    You will be using a date in this year so doing the above will not affect the 2011 financial stmts. I would suggest you use the day the boss told you to clear these up as the date for the 2 debit invoices you will be creating.

  • Hi, Smithco,

    Thank you so much.

    I am sorry, I didn't describe the situation correctly. I corrected my message.

    I appreciate your help and time.

     

     

  • No problem - sometimes it is difficult to put into words at either end :) and sometimes we are in a hurry to describe situation which can lead to confusion for those who are reading it.