Record a "Contra" payment |
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Normally the only transactions that can affect your Accounts Receivable are a Sale or a Customer Payment. Similarly the only transactions that can affect your Accounts Payable are Purchase (Bill) or a Vendor Payment. If you need to record a net payment only where a purchase and a sale are being "contra"d off against each other, then a Contra transaction is required. A Contra transaction requires an equal amount be applied to payables (open purchases) and receivables (open sales) to mark that amount paid on both sides. It is not necessary for the purchase and the sale to be to the same customer, they can be entirely different.
Open the Contra window and select the correct Customer (receivable) and Vendor (payable). Two tabs will appear underneath the Description field, one displaying all outstanding Sales from the selected customer and the other displaying all outstanding Purchases from the selected vendor.
The Contra amount will always be for the lesser of the total outstanding in Receivables or Payables. It is simpler if you determine how much the contra will be and start with the side (receivable or payable) that equals that amount. Click into the Contra column against the line items that will give you the correct Contra amount. Change to the other tab, and click into the Contra column. You might have to adjust the contra amount to the actual amount being contra'd, as by default the amount outstanding will be inserted. To Process a Contra the "Total" field on both sides must equal. Once it is processed, both Accounts Receivable and Accounts Payable will be adjusted to only reflect what is left, record that payment via Customer or Vendor Payments in the usual way.
Completed Contra transactions can be located and viewed for editing or deleting from the Cashbook Register, the Contra Journal in the General Ledger, from the Paid field within the Purchase or the Sale or from a Card Inquiry on either the Customer or the Vendor client card.
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