How to Invoice Real Estate with Owner Financing in QuickBooks
Instead of using items, I recommend that you create an additional accounts receivable account for your notes receivable. In many case, you can easily change the account type by going to Lists > Chart of Accounts, clicking on the Accounts button, selecting Edit and just changing the account type.. However, unfortunately QuickBooks doesn’t allow you to change account types to accounts receivable or payable. So you’ll need to setup new accounts using the accounts receivable type. Once you do, a new Account drop-down box will be displayed at the top of your invoices so you can choose whichever receivable account you want to use.
You can also change your previous invoices to use the correct account. However, once you’re done make sure to check your Open Invoices report (Reports > Customers & Receivables) to make sure you didn’t unlink any of payments/credits from invoices. If you did, open the invoice and click the Apply Credits button to link them up again.
If you want to map an item so it can be used on purchase transactions, ordinarily to an expense account or an asset account such as work in progress, you should make the item two-sided by checking the box next to “This item is used in assemblies…” This expands the item information so you can enter both purchase and sales accounts. The purchase account is normally one that is increased with debits (cost of goods sold, expense or asset) because when you use an item on a purchase transaction it generates a debit. The sales account is normally one that is increased with credits (revenue, liability or equity) because when you use an item on a sales transaction is generates a credit.
This article is provided for informational purposes and is not intended to be construed as legal, accounting, or other professional advice. For further information, please consult appropriate professional advice from your attorney and certified public accountant.