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Re: Refunding money to a customer



Hi, again,

Stroller wrote:
Hi there,

A while back, when working in a customer's restaurant on his laptop, I spilled a drink across the keyboard. My insurance company paid promptly, and sent a cheque directly to the customer who replaced the machine.

I have a £100 excess on my insurance, however, and would like to set this against invoices (long) owed by the customer.

Cash->Receipt

As long as there's an open invoice for the customer, you can apply any payment amount to that invoice. If it's less than an invoice, put the amount paid in the invoice line, and update -- the total should update appropriately. If it's an overpayment, check the invoices and update, and then put the total received in total box, and post. LSMB will put the extra payment in an AR transaction with a negative amount.

The next time you go to Cash -> Receipt, you'll see this overpayment and can apply it to a new invoice.

At least, that's how we do it here.
I would assume to do this by creating a new invoice on the customer's account and enter a new item of value -£100 (say under my "miscellaneous discount" service) - is this the correct way? I'm not sure if it's legal to have an invoice of negative value? (in the UK)
Can't say. Not an accountant, or an attorney.
Ideally I'd like this £100 to show up amongst the other payments & credits shown in a statement of account which I'd like to send to the customer (see my other post). However Jigme Datse's post of 13 March 2008 16:06:55 GMT (SUBJECT: Re: statements, credit notes, overpayments, budgets, tax corrections) suggests that overpayments on one invoice are not automagically credited to other invoices on the same account, so perhaps my approach is wrong.
Overpayments done this way are not automatically posted to the account, but they do show up on the AR Aging report, and they also show up in Cash -> Receipt(s) where you can apply them manually to the new invoices.

Hope that helps,

--
John Locke
"Open Source Solutions for Small Business Problems"
published by Charles River Media, June 2004
http://www.freelock.com