Payment received is less than invoiced

[Dipti]

We received a payment of $32.00 less than what was invoiced to a client. This short payment was taken out by the bank for wiring fees. When I entered the payment received, I applied the $32.00 as a discount and used the expense account of banking fees. Is that correct? Or should I use the Discount income account?

We again received a payment from this client, $798.22 less than invoiced. This amount will not be paid. Should I edit the invoice to match what was received or write it off and use the discount income account?

Also - these invoices for the client was for all reimbursement charges, so they already in an expense account.

Thank you any help!

 

[The Finance Writer]

Using the invoice discount feature in QuickBooks should arrive at the correct outcome in both cases. However, you can always check to see if that's the case by reviewing the QuickBooks reports. The customer invoice balances should indicate zero on the accounts receivable report. The P&L should have the $32.00 and $798.22 amounts, respectively, in the accounts for banking fees and discount income.

 

[Samir]

If you want to differentiate between invoices that have smaller discounted items versus write-offs like the larger amount you have, you can create a 'Bad Debts' or 'Write Offs' account. This way, you can see discounts separately than write offs on reports.