Example: Negative G/L Adjustment

You process a customer's payment through a credit card company. The credit card company charges you a 3.5 percent fee to process the transaction. When you receive payment from the credit card company, you want to enter the processing fee directly to the general ledger and apply the full amount that the customer paid to the associated invoices.

For example, a customer paid the credit card company 9,647.05 for these invoices:

• RI 3125 for 1,162.75

• RI 3126 for 5,034.30

• RI 3127 for 3,000

In addition to fully applying the customer's payment to the three invoices, create a negative G/L receipt for the 3.5 percent credit card processing fee of 337.65. As a result, the system closes the invoices and creates an entry to the corresponding expense account in the general ledger.

To complete this scenario:

1. Using the Standard Receipts Entry program, enter the receipt information specifying 9,309.40 as the receipt amount.

2. Select the three invoices to be paid and apply the invoice amount as the payment amount to each invoice.

   A negative amount of 337.65 remains as unapplied.

3. Select General Ledger from the Form menu.

4. Specify the account to which you want to make the adjustment for the processing fee.

5. Enter the negative amount of 337.65.

6. Complete the entry.

   The system applies the full amount that the customer paid to the credit card company closing out the three invoices.

7. Post the receipt to create these G/L entries:

   • Debit of 337.65 to an expense account for the credit card processing fee.

   • Debit of 9,309.40 to a bank account.

   • Credit of 9,647.05 to the A/R trade account reducing the customer's liability.