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About this lesson

In this lesson, we talk about common mistakes found on the accounts receivable report.

Quick reference

Accounts Receivable

It's important to keep an eye on your accounts receivable details to ensure there are no mistakes.

When to use

You should review this report weekly or monthly depending on your business as a regular part of your business. In this lesson, we'll focus on ways to review your customer balances. Your goal is to ensure that customers who have paid their bill are not showing an outstanding balance.

Instructions

There are a few different reports that I'm going to show you, as you work through this lesson, think about which report(s) work best for you and your needs.

The goal:

  • Look for any customers who show a balance due that is incorrect
  • Look for any customers who show a balance due of $0.00 

Reports you may wish to look at:

  • Accounts receivable aging summary 
  • Accounts receivable aging detail
  • Customer balance detail
  • Customer balance summary

Hints & tips

  • It's important to clean up or correct any incorrect balances because it's not just the accounts receivable reports that are wrong when this happens.
  • Another report which isn't used for error checking but can help you identify which payments were assigned to a given invoice is the report called the Invoices and Received Payments report.
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  • 00:04 In this video I want to talk to you about locating and
  • 00:07 correcting errors to accounts receivable.
  • 00:10 Accounts receivable is when you send a client an invoice and
  • 00:13 you ask them to pay you for that invoice.
  • 00:16 Every so often, there's a little snuf few with that.
  • 00:18 So I want to show you how to find and correct those.
  • 00:22 On the left hand side of our screen, I'm going to click on reports.
  • 00:27 I'm then going to select accounts receivable aging summary.
  • 00:31 When I look at my aging summary,
  • 00:33 what I'm looking for, is to see are these balances correct.
  • 00:38 Most of the time with our businesses, we can look at these and say yeah,
  • 00:42 these people owe us money or no they don't.
  • 00:44 Or maybe we look at this report and say, my gosh,
  • 00:47 I really need to follow up with someone.
  • 00:50 What I want to talk to you about is what we see here.
  • 00:53 We see that cheesy Chester owes 1500 dollars.
  • 00:57 I can click on either this 1500 or this 1500 to see why.
  • 01:02 It looks like bed two invoices.
  • 01:04 I can click on the invoices to see what they are.
  • 01:07 If I go down I see Gleeful Gizmo.
  • 01:10 Gleeful Gizmo does not owe money, but they show up here and it's weird.
  • 01:16 And then sample customer.
  • 01:17 Sample customer owes money.
  • 01:20 So I want to talk to you about Gleeful Gizmo.
  • 01:22 The total on the right hand side says 0.
  • 01:25 Whenever you see a client who has a 0 on the total column, but
  • 01:29 somehow there's still an AR aging report.
  • 01:32 It means they have a small mistake that you need to correct.
  • 01:36 So I'm going to click on the total, so you can see it What I have within
  • 01:41 my QuickBooks is an invoice of 799 and a payment of 799.
  • 01:46 But somehow the two aren't linked.
  • 01:48 I'm going to show you what that looks like in the Gleeful Gizmo profile.
  • 01:52 I'm going to go sales customers.
  • 01:55 Gleeful Gizmo, and then I'm going to look and sometimes when this list gets long.
  • 02:00 You might start by status or you might just look for anything that's not green.
  • 02:05 So I can see that there's a payment.
  • 02:06 The payments unapplied and there's an invoice the invoice is overdue.
  • 02:11 When I look in the upper right hand corner, I can see overdue, but
  • 02:14 I can see they don't have an open balance.
  • 02:17 When this happens, you just want to navigate to the payment.
  • 02:21 So you can either come into here and
  • 02:23 find the payment, you know the year that at the payments box.
  • 02:26 It says, Receive Payment.
  • 02:28 Or you can be on the AR Aging.
  • 02:34 You can come over here, you can click on this total of 0.
  • 02:37 You can find the text that says payment.
  • 02:41 Once you get to the payment, you can say I've received 799.
  • 02:45 This money came in on 715.
  • 02:47 So a while ago, we deposited in the bank account,
  • 02:50 the bank it's been reconciled we know we got this money hundred percent.
  • 02:55 But it's not linked to an invoice.
  • 02:57 And therefore it's showing that this invoice down here Interestingly enough of
  • 03:02 the same exact amount is unpaid.
  • 03:04 All you need to do to correct it is to click the little checkbox to the left.
  • 03:09 And you can say please apply this payment that I've already logged
  • 03:13 with this invoice.
  • 03:14 Which is currently showing open or outstanding and then save and
  • 03:17 close on the right hand side.
  • 03:21 If we go back to report summary, we can see Gleeful Gizmo is no longer here.
  • 03:27 And when we go to their profile in the upper right hand corner we
  • 03:32 show a zero dollar open balance and a zero dollar overdue.
  • 03:36 When we scroll down with the only green text.
  • 03:40 That happens once in a while, so I wanted you to see, here's how to find it.
  • 03:44 Here's how to correct it.

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