What is credit applied for in pay bill?

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How you enter the credit depends on how you record your purchases. If you enter bills you plan to pay later, if you enter bills to track your expenses. This makes sure the credit hits the expense account you use for this supplier.

1. Click the + New Plus icon. 
2. Select Debit Note.
3. In the Supplier dropdown, choose your supplier.
4. Depending on how you record purchases with this supplier, enter the Category details. Usually, this is the category, product, or service you’re getting credit for.
5. Press Save and close.

Then, you can apply a supplier credit toward any open or future bill. When you’re ready to use the credit, just follow the steps below: 

1. Click the + New Plus icon. 
2. Select Pay bills or Pay bill.
3. Choose a bill for your supplier from the list. You'll see the available credit with this supplier in the Credit Applied field.
4. Complete the rest of the fields like you normally do.

For other cases or options on how to apply for supplier credits and refunds, just check out this article: Handle supplier credits and refunds in QuickBooks Online. If you got a refund for a business expense, follow the steps in this article: Enter a refund from a supplier. 

Feel free to visit our Manage Suppliers and Expenses page for more insights about managing our vendor transactions.

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