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msotera
New Member
September 18, 2026
Question

Fixing AP Balance/Entering Credits

  • September 18, 2026
  • 3 replies
  • 21 views

We currently use QB desktop. It was discovered that a few bill payments were not being correctly allocated to each class. Either due to a credit being entered on a bill or an asset account used on the bill. For example, if class A’s expense on the bill is $400 (increasing AP by $400), when the payment was entered in QB, only $200 is being applied to the AP account. Creating a balance in the class. Note: AP as a whole nets to 0.
 

I noticed if a negative amount is in the bill, this AP difference appears AND if an account other than expense is used in the bill, this AP difference appears.

 

Q1: I am attempting to enter a journal entry hitting all the AP classes to get rid of this balance, but I am receiving an error message saying “You cannot use more than one A/R or A/P account in the same transaction.” Is there an easier way to fix this issue instead of doing a ton of journal entries to clear the balances off the AP account?

 

Q2: Why am I unable to enter credits or use accounts other than expense in a bill? How am I supposed to account for the credits and other accounts outside of expense properly if they pertain to a different account? 

3 replies

MoiraskyeTQuickBooks Team
QuickBooks Team
September 18, 2026

The error "You cannot use more than one A/R or A/P account in the same transaction" occurs in QuickBooks Desktop because it restricts direct journal entries to Accounts Payable (A/P) when you assign vendor names and mix classes. Since A/P is a control account linked to the vendor sub-ledger, QuickBooks blocks this action. To fix the issue, create a clearing account and use two journal entries to transfer the incorrect class balance to the correct one.

 

Here's how:

 

  1. Go to Company and click Chart of Accounts.
  2. Select the Account dropdown and choose New.
  3. Select Bank or Other Current Asset, name it AP Clearing, and click Save & Close.
  4. Then create a Journal Entry by going to the Company section again and selecting Make General Journal Entries.
  5. Use your newly created A/P Clearing account to adjust amounts between classes, ensuring that debits and credits balance out for each class.

 

Run the Balance Sheet by Class report to confirm the class discrepancies in A/P are resolved, and the clearing account balance has returned to zero.

 

You can use non-expense accounts (like Assets or Inventory) on a bill, but QuickBooks Desktop requires a class on every single line. Assign a class to every line item on the Expenses tab, and ensure inventory items or line columns are properly classified.

 

To properly account for credits so they are assigned to the correct class, please follow these steps:

 

  1. Go to Vendors and select Enter Bills.
  2. At the top of the screen, change the radio button from Bill to Credit.
  3. Enter the credit amount as a positive number.
  4. On the Expense or Item tab, assign the specific Class the credit belongs to.
  5. When paying the standard Bill later via Pay Bills, click the Set Credits button to apply this Vendor Credit against the open balance. This keeps the A/P class allocation perfectly balanced.

 

Please respond to this post if you have additional concerns.

msoteraAuthor
New Member
September 21, 2026

Follow up question to your response to Q1: What would be my two journal entries? Would we debit the AP account and credit the clearing account; then debit the clearing account and credit cash? In our situation, we have multiple classes with AP balances. Is the only way to get AP corrected by entering multiple journal entries?



Follow up question to your response to Q2: We class each line of our bills. Following your instructions for entering a credit, the payment is still not being allocated correctly. We use a revenue code for the credit. However, to test the credit instructions as you provided above, I tried using an expense account instead, but the payment continues to allocate differently than the bill indicates.

KayePeQuickBooks Team
QuickBooks Team
September 21, 2026

When creating a journal entry, it's best to consult your accountant to confirm which accounts to debit or credit to clear your class A/P balances. Regarding your second question, testing revenue against expense accounts on bills didn't resolve the issue because revenue accounts can inflate the income on vendor reports. Depending on your scenario, there are alternative ways to enter credits and map non-expense accounts. If a vendor sends you a refund check for a paid bill, you can record a deposit and select Accounts Payable as the account. Here's how:

 

  1. Go to the Banking menu, then select Make Deposits.
  2. If the Payments to Deposit window appears, select OK.
  3. In the Make Deposits window, select the vendor who sent you the refund from the Received From dropdown.
  4. Choose your Accounts Payable account from the From Account dropdown.
  5. Enter the exact check amount in the Amount column.
  6. Select Save & Close.

 

Next, record the bill credit for the refunded amount, then link the deposit to it using Pay Bills. If you are dealing with a different scenario, you can review this article for step-by-step guidance: Record a vendor refund in QuickBooks Desktop.

 

Let us know if you have any additional concerns. We're here to help.

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