Sometimes a receivable or payable charge is overpaid, meaning you either paid or received more money than was originally owing. Here’s how to record those overpayments in AgExpert Accounting:

Overpayment on a receivable charge:

You sold your mower to your neighbour for $1,000. A few weeks later they write you a cheque for $1,200. Record the original cheque, as in the transaction below and a credit of $200 will be added.

Another option to record a receivable overpayment would be to use the credit note method.

Once you’ve received the payment, record the receivable as it was originally entered, in this case it would be $1,000. Add a second row to your transaction and select Create credit note (CN+). This will allow you to add the extra $200 you received and balance your transaction.

You’ve done some custom work for John Doe and charged him $300. You will now see that there is a credit of $200 on his account. Applying this credit means that you will receive the remaining $100 owed to you.

Overpayment on a payable charge:

You owe CRA $2,463.37 for the payroll remittance for July and you pay $3,000. Enter $3,000, as shown below, and a credit of $536.63 will be added.

Another option is to use the credit note method. You will record the payable payment as it was originally entered. Next, add a second line and select Create credit note (CN+). Here, you will enter the difference between the amount you paid and the correct amount. In the example below the payable to CRA is $2,463.37 but $3,000 was paid. The difference between the two is $536.63.

Your next payment to CRA will be reduced by the credit of $536.63.

Last updated on August 18, 2020 by FCC AgExpert