Payment Posted Twice to Same Account

This document explains what to do if you have posted a payment twice to the same account.

If the double payment originated from Order Entry, see the document: "Order Entry Credit Memo Refund"

Below is an example that will be used for explaining:

Customer 200 - Tom’s Construction

Invoice 12345 dated 01/01/xx for $100.00

Payment 200037 (check 5000) dated 02/01/xx for $-100.00 applied to invoice 12345

Payment 200038 (check 5000) dated 02/01/xx for $-100.00 applied to invoice 12345

STEP 1 - First enter in a zero debit memo.

Go to:

Accounts Receivable (Module 2)
- Sales Entry & Editing (Task 1)
  - Enter New Sales Record (Sub-task 1)
    - The important/necessary fields are listed below:
      - First Screen:
      - 01. Invoice #: Numeric. Assign an invoice number that is out of the range of the system generated invoice or CM numbers. For this example, we will use debit memo #90000
      - 02. Inv date: Enter a date in the current month
      - 04. Division#:
      - 05. Sale type: “5” – debit memo
        
        The system will prompt: “Check for duplicate credit memo or debit memo?”. Answer Y
      - 06. Customer #: Type in the customer # with the double payment.…per the example, this would be 200
      - 07. Salesman# :
      - 15. Apply to: (it will be applied to itself)
      - 28. P/O #: This is a 20 character alphanumeric notation. Type an abbreviation for your records, example: “DOUBLE PAYMENT”

The amounts are all zeros, so the system won’t go to the second screen.

Use Sub-task 4 (Print Sales Edit List) to verify the entries. If correct, use Sub-task 5 (Post Sales Records to A/R Files) to post.

STEP 2 – Apply the incorrect/duplicate payment to the zero debit memo just posted in step 1.

Go to:

Accounts Receivable (Module 2)
- CHANGE APPLY-TO #'S (Task 3)

General Rules:

Invoices are always automatically applied to themselves when they (invoices) are posted. No exceptions.

Finance Charges and Debit Memos are applied to themselves when they are posted.

Finance Charge or Debit Memo may be applied to an invoice.

Finance Charges and Debit Memos cannot be applied to payment or credit memos.

Credit Memos and Payments can be applied to invoices, debit memos or finance charges.

Procedure: If the payment is in the customer account as multiple amounts (as per our example), each applied to separate documents, you will apply each to the zero debit memo posted in Step 1.

System prompts for Customer number and Document number. For the example above, type in customer 200 & document 200038 (because this is the 2^nd/duplicate payment). The system would then show the document amount is $100.00 and the Old Apply-to # as 12345
The system prompts: Wrong Trx? N. Press Return/Enter key if the proper document is displayed, enter Y if it is not the correct document.
System prompts for “New apply to #”. Type in the zero debit memo # just created and posted in Step 1.
With the above example, invoice 12345 now has a zero balance with the original payment (200037) applied to it.
The duplicate payment is applied to the newly created debit memo, showing a negative balance.

STEP 3 – Now the check should be entered in as a negative and applied to the zero debit memo.

Go to:

Accounts Receivable (Module 2)
- Cash/Receipts Entry & Editing (Task 2)
  - Enter (ADD) New Cash (Sub-task 1)
    - The important/necessary fields are listed below
    - First Screen-
      - 02. Trx Type: Use type 2
      - 03. Customer #: Type in the customer # with the double payment.…per the example, this would be 200
      - 04. Recv Date: Use current date (i.e. May 20, 20xx)
      - 06. Check$: Enter the amount of the check as a negative (per the example $-100.00). The amount will appear as + on the customer's account. Think Algebra…negative and negative equals positive.
      - 07. Check #: Use the original check #.
      - 08. Disc $: If the original transaction had a discount given, type in the same amount of the discount, only a negative.
    - Second Screen
      - On field 1, in the “Doc #” column, type in the zero debit memo number just created and posted in Step 1.
      - This zero debit memo should have a balance negative for the amount of the payments applied to it in step 2. So for this example, the zero debit memo would have a $-100.00 balance. If you press the ENTER key in the “Apply-amt “column, the $-100.00 entered on the first screen is applied to the zero debit memo.
      - If the original amount had a discount, on the first screen, field 8 should have the same discount amount only as a negative. On the second screen, the negative discount amount should be entered under the DISC column.
  - The Sub-task 4 (Print Cash Edit List) should be printed to verify the entries.
    - Total Amount Received: and Total change to A/R: Should both be the negative amount. In this example it would be $-100.00
    - If everything is correct, use Sub-task 5 (Post Sales Records to A/R Files) to post.
      - Save posting & enter on Daily Balancing Spreadsheet as usual.

Note: After posting, this is what the account should look like:

Customer #200 Tom’s Construction --

Invoice 12345 dated 01/01/xx for $100.00

Payment 200037 (check 5000) dated 02/01/xx for $-100.00 applied to invoice 12345, leaving a balance of Zero.

Debit Memo 90000 dated 05/13/xx for zero dollars

Payment 200037 (check 5000) dated 02/01/xx for $-100.00 applied to DM 90000

Payment 200079 (check 5000) dated 05/20/xx for $100.00 applied to DM 90000, leaving a balance of Zero.

At month end, after all month-end balancing procedures are followed, the “Clear Paid Invoices from A/R Open” program is ran, and these will all clear off of the account.
Your ‘cash’ was overstated when the same check was posted twice to a customer’s account; the negative payment will balance your cash.