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There can be many reasons that payment is received without allocating it to lines on an invoice.  You may not have raised the invoice line items yet, or, the payment may need to cover multiple invoices that may or may not currently exist in the person's record.  This article describes the procedure for receiving and then subsequently allocating the payment to one or more invoices.


Unallocated Cash Account Prerequisite

Your system should have an income account to receive "Unallocated Payments"   This is a clearing account that holds income prior to it being allocated to any particular invoice.  When you receive a payment that needs to be held in "limbo" or needs to be applied to multiple invoices, the procedure described below explains how to receive the payment and then allocate it.


Receiving Payments into Unallocated Cash

This procedure is used for two scenarios:

  1. Receiving cash that is yet to be allocated to any invoice
  2. Receiving cash in payment of multiple invoices

In the example below, we are receiving payment for two invoices - one for $10 and another for $50.  Perform the following steps:

  1. Open one of the invoices to be paid in the person's invoices tab in their record.
  2. Begin to process a payment in the normal way
  3. When it comes to the payment amount, enter the amount of the full payment received (a) - in this case, the two invoices total $60.  You will see a warning appear that you have entered more than the amount due on the invoice.
  4. In the "Account" field that becomes available (b), select the account that will temporarily hold the balance of the "overpayment" for this invoice.
  5. Process the payment normally.


The result of the payment transaction will be the addition of two payment lines on the invoice:

  1. The first payment line shown below (could be multiple lines if there are multiple invoice lines on the invoice) is applying part of the payment to the line(s) on this invoice.
  2. The last payment line is receiving the overpayment into the Unallocated Cash Account.


This unallocated cash amount will now show up under the invoice total of any invoice opened for that profile.


To apply this overpayment to the other invoices for the profile:

  1. Open the other invoice (if there are multiple, open each in turn)
  2. Begin a payment as you normally would
  3. For the payment Type, choose the "Unallocated Cash Payment" option that now appears.
  4. This will use those unallocated funds to pay this invoice.



On the original invoice that was used to hold the unallocated cash, you will now see a "Cash Transfer" line item that indicates the unallocated cash previously posted to that invoice has now been transferred to pay the other specified invoice number.





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