Dealing with a vendor who is also a customer

If your business sells goods and services to a business from which you also make purchases, you need to record the transactions using a separate customer and vendor card. You can then record a contra payment to offset the receivable and payable amounts.

Before you can record contra payments, you need to create a bank account called Contra Suspense. For information about creating accounts, see Set up accounts.

To record contra payments

1	Record a payment from the customer.

a	In the Receive Payments window, type or select the Contra Suspense account in the Deposit to Account field.

b	In the Customer field, type the customer’s name or select it from the list.

c	Type the amount that you need to offset against an invoice.

2	Record a payment made to the vendor

a	In the Pay Bills window, type or select the Contra Suspense account in the Pay from Account field.

b	In the Vendor field, type or select the vendor’s card.

c	Type the amount that you need to offset against a purchase.

After these entries are made, your bank accounts will not have been affected; yet the receivable and payable accounts have been reduced. The Contra Suspense account balance should be zero.

Related topics

■	Receiving payments

■	Paying bills