Business Use Case:
In many instances, when a customer payment is received on an invoice, it exceeds the amount of the invoice by a couple of cents. For instance, if the original amount of the invoice is $19.98, the customer may opt to send a cheque for $20. In such a case when customer payment is entered in NetSuite on the Payment Amount column under the Apply tab of the Enter Customer Payments screen, only $19.98 is applied towards the customer invoice, the remaining two cents remain unapplied and show as overpayments in the aging reports. Changing the invoice amount to the full amount of the payment is not possible because invoice cannot be edited in a closed period.
This type of overpayment can be closed in following ways:
1. Doing a customer refund from Transactions > Customers Issue Customer Refund. However, if the amount of over payment is in pennies and the customer is not interested in receiving the change, process described later can be followed.
2. Applying the amount of overpayment to a customer's open invoices. If there is no invoice open, the process described below can be followed.
Create a GL entry that will increase the balance of the customer by two cents and charge this to an income account. The increase in customer balance is then offset by charging the unapplied overpayment against it.
In order to accomplish, follow the following steps.
1. Navigate to Transactions > Financial > Make Journal Entries.
2. Enter the following field on the GL entry:
Date: Date when the payment was received.
Account: Accounts Receivable
Debit: Amount of the over payment
Name: choose name of the customer
Account: Miscellaneous Income
Credit: Amount of the over payment.
3. Save the GL entry.
4. Navigate to Transactions -> Customers –> Accept Customer Payments.
5. Enter the following fields on the New Payment screen.
Customer: Customer on the invoice.
Date: Date when payment was received.
Under Invoices sub tab, mark the GL entry that you created.
Under Credits sub tab, choose the amount that was received extra on the top of the invoice amount. This is shown as a Payment line on the credits sub tab. Orig. Amount column shows the amount received and the Amount remaining column shows the amount that was received extra.
6. Save the Payment.
7. Go back to the original payment and verify that the overpayment has been cleared by the journal entry you created. The over payment no longer appears in AR aging reports