Accounts Receivable linked accounts

Using Linked Accounts Overview > Why linked accounts? > Accounts Receivable linked accounts

Here is a list of the linked accounts that are used for sales transactions, along with information about where the linked accounts will be used:

The amounts your customers owe your business for purchases they've made on account are considered assets. This account summarizes all the money owed to you by your customers; it appears on your balance sheet and other financial reports. This account will be debited (increased) whenever you enter sales on account using the Sales window. This account will be credited (decreased) whenever you enter payments from customers using the Receive Payments window.

  • Checking Account for Customer Receipts

This account is used to track the amounts paid to you by your customers. Depending upon your choices in the Preferences window, this account may appear as a default entry for the transactions you enter in the Receive Payments window. If you like, you can choose another checking account, or you can indicate that the funds aren't ready to be deposited yet. When you enter a payment from a customer, this account (or the checking account you select instead of it) will be debited by the amount of the transaction, and your linked Asset Account for Tracking Receivables will be credited. In effect, the checking account will be increased and the accounts receivable account will be decreased.

The account you select here must have been assigned checking or credit card privileges in the Edit Accounts window.

  • Income Account for Freight

This account is used to track the freight amounts you enter for the sales you make using the Sales window. This account enables you to see how much of your gross sales amount is actually goods or services, and how much is payment for shipping. This account appears on the Trial Balance, the Profit and Loss Statement and other reports.

This account is used only if you marked the "I collect freight on sales" option in the Easy Setup Assistant or the Accounts Receivable Linked Accounts window. If you don't ship goods to your customers, you can skip this account.

  • Liability Account for Customer Deposits

This account is used to track the amounts customers pay in advance for orders entered in the Sales window. The amount is considered a liability for your company until the sale actually is made, because all or a portion of the deposit will have to be repaid to the customer if the sales isn't made. This account appears on the Trial Balance, the Profit and Loss Statement and other reports.

This account is used only if you marked the "I track deposits collected from customers" option in the Easy Setup Assistant or the Accounts Receivable Linked Accounts window. If you don't take deposits from your customers, you can skip this account.

  • Expense or Cost of Sales Account for Discounts

This account is used to track the discounts taken by customers for early payment, based on the credit terms you've assigned to them. When you enter payments using the Receive Payments window, the discount amount the customer is eligible for appears as a default entry, but you can enter a larger or smaller amount, if necessary. The actual discount amount you enter will be tracked using the Expense or Cost of Sales Account for Discounts.

This account is used only if you marked the "I give discounts for early payments" option in the Easy Setup Assistant or the Accounts Receivable Linked Accounts window. If you don't offer early-payment discounts to your customers, you can skip this account.

  • Income Account for Late Charges

This account is used to track the fees you collect when a customer's payment is past due, or if you offer revolving credit and charge a finance fee on unpaid balances. This account is updated when you enter an amount in the Finance Charge field in the Receive Payments window.

This account is used only if you marked the "I assess charges for late payment" option in the Easy Setup Assistant or the Accounts Receivable Linked Accounts window. If you don't collect late fees or finance charges from your customers, you can skip this account.

Click below for the step-by-step procedure:

Click below for the step-by-step procedure:

To change Sales linked accounts

Linked accounts > Accounts Receivable linked accounts