Clearing out customer credit

Hi smm,

The way you clear out transactions from a clearing account depends on how you need them to show up in your records. You can either create a journal entry or go through the electronic payment process, it really depends on what the transaction’s all about.                                                                                                                                     

I'd love to share my own take on your first question about customer credits that can’t be refunded. You can tidy up those leftover credits by either applying them to any outstanding invoice or just popping in a journal entry to keep everything nice and organised. Here's a similar post outlining the steps you need to clear out customer credits. 

Cheers,

Princess

Thanks for that, so then how do I clear out the clearing account>

Hi smm,

My apologies for the confusion. What we meant is, you can record the refund in a dedicated account specifically used for clearing credits. Essentially, create an account for clearing credits and then record the refund in that account. The provided help page above has detailed information about this. 

I hope this helps!

Regards,
Earl

Thanks Genreve, I'm not sure I understand what you mean. Can you elaborate please?

Hi smm, 

Clearing unreturnable credits, these are recorded based on how you want them to show up in your ledger. The easiest way is to use the same concept as writing off bad debts, but in negative values. You’ll need an account set up to track the credit you’re clearing out, and just pop the refund against that account. That’ll wipe the credit for that customer and make sure it’s logged somewhere you can keep tabs on that amount. Also, you can ask for advice from an accountant if you want to make sure it's recorded the best way possible. Hope that helps! 

Regards,

Genreve