As we said earlier, the Accounts Receivable account is special. You didn't enter the invoice amount in A/R. You simply posted the invoice and the amount magically showed up in A/R. In the same manner, we won't enter the receipt of payment in the A/R directly from the account register either.
- When you are in the View Invoice tab, you will see an extra menu item under Business called Pay Invoice. You will also see the Pay Invoice toolbar button show up. Go ahead and click that. The Process Payment window will open as shown in the following screenshot:
- Pretty much everything on the left pane is pre-filled conveniently for you. You can change the Date, if needed.
- On the right hand side, you need to select a Transfer Account. In this case, you received a check. Go ahead and select Checking Account under Current Assets. Click on OK.
- Confirm that the appropriate entries have been made in Accounts Receivable and the Checking Account.
- Go to Find Invoice and find this invoice. You should see a small green check mark under the Paid column for this invoice.
Payments received by you against delivery to customers can be entered in the account register directly. However, payments received against invoices are special and GnuCash requires you to treat them with special care. This is because the matching invoices have to be marked as paid. For this reason GnuCash provides a special module called Process Payment for this very purpose. The three modules, namely Customer, Invoice, and Payment Process work in a coordinated manner to make sure that all the transactions are entered and tracked properly.
If you receive partial payment against an invoice, you can go ahead and process that partial payment against your invoice. For example, if your invoice is for $3000 and you receive $2000, you can enter $2000 in the Process Payment dialog for that invoice. GnuCash will reduce the Accounts Receivable by $2000 and keep track of the remaining balance of $1000 from that customer on that invoice.
- You have received a check payment from a customer against an invoice that you sent to them earlier. What are your options for entering that payment in GnuCash?
a. Checking account register.
b. Process payment.
c. Process payment or checking account register.
d. Process payment and checking account register.