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How to close an open invoice without customer payment

Posted on by 10

Hi everybody

I have an open invoice for a customer who died. Then he never will pay the invoice. I can't find a way to close definitively the open invoice.

If I try to generate a payment through "cash receipt journals"  with amount =0, I can't validate the line.

Does anyone know a solution to close the invoice without payment ? (the amount will pass as loss on debtor).

thanks for your support.

  • CU11121527-0 Profile Picture
    CU11121527-0 154 on at
    RE: How to close an open invoice without customer payment

    If you select the "Tax Area code" and "Tax Group code" the system should calculate the rest. 

    sales-credit-memo-_2D00_-loss.png

  • FredBsag Profile Picture
    FredBsag 10 on at
    RE: How to close an open invoice without customer payment

    We should also consider the impact on VAT calculation.... in case of invoice with multiple VAT rate, we need to calculate manually the right amount for each VAT rate.  the solution from WhatWhyHow seems to be good if we separate in 2 lines (one for each VAT rate).

    Thanks to everybody for your answers.

  • Manthan Thesiya Profile Picture
    Manthan Thesiya 59 on at
    RE: How to close an open invoice without customer payment

    As you are Totally aware that Every company maintain One G/L account for Loss Entries.

    You can Directly post JV against that Customer and Loss account for the remaining amount which is not Received.

    Manually apply customer ledger entries to knock off remaining amount.

    >> and this entry will be valid to in audit purposes.

  • Suggested answer
    CU11121527-0 Profile Picture
    CU11121527-0 154 on at
    RE: How to close an open invoice without customer payment

    Hi 

    I assume the Sales Invoice is already posted, inventory has left the warehouse and the inventory is a loss (u won't get them back)

    1. Create a new "Sales Credit Memo"

    2. Enter the Customer No. in the field  "Customer No."

    3. Click on "Process" menu and select "Apply Entries"

    4. Find the posted sales invoice  and select that line and select "ok" (this will make a link/relationship against the open posted sales invoice)

    5.  Now click on the "Prepare" menu and select "Get Posted Document Lines to Reverse"

    6. Find the "Posted Invoice" from the list and select. Press Ok

    7. In the "Lines" section keep the first two comments line and remove/delete all the other items lines (if u keep these item lines the system will put back the inventory)

    8. Once you delete all the item lines, you balance should be $0

    9. Now enter a G/L line which represent loss/theft etc. 

    8. Enter Qty=1 and Amount before tax should be same as the original Sales Invoice (look it up)

    9. Post the "Sales Credit Memo" (make sure the total amount between the Sales Invoice and the Credit memo is exactly the same)

    By doing so you will see that customer was credited the balance but the inventory is still a loss. 

  • FredBsag Profile Picture
    FredBsag 10 on at
    RE: How to close an open invoice without customer payment

    Hi Daniele,

    thank for your answer. I already have this idea but it 's not really correct to consider it's a credit memo. The goods are on customer side and it's a lost for the company (not a credit memo).  Moreover the customer had already paid a part of the invoice, then I'm not sure if it's legal to do so.

    thank you for your time

  • Suggested answer
    Gavin Profile Picture
    Gavin 2,339 on at
    RE: How to close an open invoice without customer payment

    Hi,

    You can manually post a credit note and code that credit note to the bad debt account. You can then apply this to the invoice

    For example below is a Sales Journal that would post a credit memo to a customer which would update the bad debt GL account

    pastedimage1674056775620v1.png

    After you post this you can then apply this to the Sales Invoice.

    You could also use the Sales Credit Memo page to post the adjustment as well. Just pickup the Bad debt account

    Hope this helps

    Thanks

    Gavin

  • Suggested answer
    DAnny3211 Profile Picture
    DAnny3211 9,272 Super User 2024 Season 1 on at
    RE: How to close an open invoice without customer payment

    hi

    you might want to make a credit memo and tie it to the invoice like this:

    pastedimage1674056372022v1.png

    pastedimage1674056411807v2.png

    pastedimage1674056457045v3.png

    by recording the credit memo you will automatically reverse the invoice

    check my answer if it helped you, thanks

    DAniele

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