I have paid a vendor and record it as a deposit. Now I want to apply this deposit to the invoice from the vendor. How to do that?

Thanks for reaching out here in the Community, kalper23fin. Let me provide insights about paying a vendor and recording a deposit in QuickBooks Online (QBO).

Please know that when you pay for vendor invoices, you are not required to record a separate deposit in your accounting system. Instead, the only action you need to take is to create a bill payment that reflects the amount you are paying to the vendor. Since you already entered a deposit, it is essential to delete that entry to maintain accurate financial records.

If you haven't created a bill for the invoice you received from your vendor, let me guide you through the process.

Here's how:

1. Go to +New and click Bill.
   
   
2. From the Supplier dropdown, select a supplier.
3. From the Terms dropdown, select the bill's terms, then enter the Bill date, Due date, and Bill number.
4. Enter the bill details in the Category details section. From the Category dropdown, select the expense account you use to track expense transactions. Then, enter a description and amount.
5. Once done, click Save and close.

After that, you're ready to make a bill payment. There are two ways to record bill payments.

Here's how if you pay a bill with a credit card or cash:

1. Click +New, then select Pay bills.
   
   
2. From the Payment account dropdown, select the account you paid the bill from. 
3. Enter the Payment date and select the checkboxes for the bills you made a payment towards.
4. In the Payment column, enter the amount you paid towards each bill.
5. Once you're done, hit Save or Save and close.

Moreover, I'm adding this article for detailed information and the second option in making a bill payments: Enter bills and record bill payments in QuickBooks Online.

If you have follow-up questions about bills, please don't hesitate to click the Reply button below. I'll be around to help.