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Robert M.
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Category: Financial Software
Satisfied Customers: 7170
Experience:  30 yrs. of computer experience in financial and marketing departments.
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We manage a property for someone else. They pay us a 20% rental

Customer Question

We manage a property for someone else. They pay us a 20% rental commission. The tenant pays us instead of the homeowner.

If rent is $1,000 we invoice the homeowner for $200. The tenant sends us a check for $1,000 which leaves a credit balance on the invoice of $800.00. We then write a check to the homeowner for $800. I need to attach this check to the credit so that they cancel each other out.
Submitted: 10 months ago.
Category: Financial Software
Expert:  Robert M. replied 10 months ago.

Hi, I'm Robert and I'll be helping you with your financial software question.

 

The better way to do that is to set up the owner as a vender. You purchase the rent from him for 800 and sell it to the home owner for 1000.

Customer: replied 10 months ago.
This is after the fact so I need an answer to my specific problem.

Also, these are weekly vacation rentals so the COGS would vary on every rental.

I need specific journal entry instructions:
The invoice has a credit balance.
The check for this amount has already been written.

It just needs to be a pass through so that only the commission is booked as revenue in my business.
Expert:  Robert M. replied 10 months ago.
what software are you using ?
Customer: replied 10 months ago.
Quickbooks Pro
Expert:  Robert M. replied 10 months ago.

you might want to look over this page on how to set up a consignment which works the same way where you don't actually own and sell the item but hold it for the seller and then take the entire price from the buyer and give the part minus your commission to the seller.

http://www.sleeter.com/blog/2012/05/consignment-goods-with-quickbooks/

Customer: replied 10 months ago.
That's fine for future I suppose but what I'm looking for is a specific answer to my question which is:

I have a credit balance on an invoice. I have a check written in the check register for the same amount. How do I apply these against each other to zero them out.
Expert:  Robert M. replied 10 months ago.

you can add an item to the invoice for 800 for homeowner

 

or create another invoice for the same rent for 800 with item name - owners share or something descriptive like that.

 

apply the credit from the extra 800 to this other invoice or new item on the old invoice

 

 

 

 

Customer: replied 10 months ago.
I don't want to do that as its not my income.
Customer: replied 10 months ago.
Relist: Other.
Not answering my direct question which is what journal entries can I make to offset the debit and credit?
Customer: replied 10 months ago.
Never mind I figured it out. The answer is:Open the check register and double click the check.Pay to the order should be the homeowners name.Account should be Accounts Receivable.Customer:Job should be the renters name that the original invoice was made out to.When this is applied, it zeros out the credit balance on the customer:job.
Customer: replied 10 months ago.
I figured it out myself. It doesn't seem like you put much effort into answering the question. By trial and error and seeing how the balance sheet and P&L accounts were affected trying various options, I came up with the solution.

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