Overpayment To Finance Charges

Overpayment went to Finance Charge

Scenario:

• A payment was applied to an Order

• The payment was greater than the Amount Due on the Order, and the overpayment went to the income account that is linked to Finance Charges

• The Order was changed to an Invoice

• Because payment was received to an Order, and posted to Customer Deposits, payment Deletion or Reversal is not possible

To resolve the situation on a non-Item Invoice (Delete the Finance Charge):

• Create a Backup of your Company FIle

• Open the Transaction Journal

• Find the Credit posting to the Finance Charges account

• Open the Sales Invoice

• Looking at the Sales Invoice, change the indicated Income Account to the account for Finance Charges

• Change the Amount to the negative value of the Finance Charge

• Remove other line items from the Invoice

• Remove all reference(s) to Sales Tax

• Click OK

To resolve the situation on an Item Invoice (where you can return items to inventory) (Delete the Finance Charge):

• Create a Backup of your Company File
• Create an Item in Inventory (perhaps named FinanceChargeReturn):
• • Indicate that you only Sell this Item
• • Link the Finance Charge Income account to this Item
• Open the Transaction Journal
• Find the Credit posting to the Finance Charges account
• Open the Sales Invoice
• Remove all Items
• Add a quantity of -1 for FinanceChargeReturn with a charge amounting to the negative value of the Finance Charge
• Click OK

These procedures will create a credit for the customer for the full amount of the received payment. The Credit Memo can be refunded, or a new Sale Invoice can be created, and the credit memo applied to it. Since there was initially an overpayment, there will likely be a credit memo after paying this Invoice with the credit memo created as a result of this process. (This process will have reversed the initial sale, so a new sale will need to be created to replace it.) These processes will also create a contra Journal Entry to the entry posting the Finance Charge to the Finance Charge account.

Notes:

To perform the above procedures, you must be able to change transactions. Select the Security tab in the Preferences window of the Setup drop-down menu. Verify the item Transactions CAN'T be Changed; They Must be... is unchecked.
These procedures are not available in the Canadian AccountEdge if the Quebec Option was selected during AccountEdge installation.