To use customer credits to remove bad debts

1. Create a new account named Bad Debts and assign it an expense account classification. (Creating accounts)



2. Use the Sales window to create a miscellaneous sale for the customer. (To sell items to a customer) For each of the customer's outstanding debts, enter a line item with a negative value, using the Bad Debt account you created in step 1 in the Allocation Account column in each line item.

When you're finished, click Record. The transaction you've recorded is called a customer credit.

3. Click the Sales Register option in the Sales Command Center, then click the Returns & Credits tab.



4. Highlight the customer credit you created in step 2.



5. Click Apply to Sale. The Settle Returns & Credits window appears.



6. The customer's open sales appear in a scrolling window. Enter the amount of each open sale in the Amount Applied column.



7. Click Record. All the customer's bad debt is cleared.