Paying bills

Entering bills in QuickBooks doesn't mean you're done with them, you still have to pay them. After you enter your bills in QuickBooks you can choose the bills that you want to pay. If cash is sure you can choose how much to pay on each bill and whether you're going to write a check or use a credit card. And if you pay early to get a discount, you can take that into account too. To start paying bills, on the homepage click Pay Bills. The Pay Bills window starts by showing all the bills you've entered but haven't paid. If you want to see just the bills that are due before a specific day, select the Due on or before option and then choose a date, but here I'm going to leave it as showing all bills.

QuickBooks makes it easy to see the bills that are due the soonest by sorting by due date. In the Sort By dropdown list choose Due Date. The bills are listed from the most recent due date to the one furthest in the future here in the Date Due column. You can show only the bills for one vendor by choosing the vendor in the Filter By List. In the Filter By List select All Vendors to return to the full list. If you want to pay all the bills listed below the table click Select All Bills, QuickBooks will add a check mark in the first column for all the displayed bills.

However, you usually only pay some of the bills. In that case, turn on the check marks for the bills you want to pay such as the ones you pay using a specific payment method. Click a check mark box to toggle the check mark on and off. QuickBooks automatically fills in the amount to pay cells with the full bill amount. If you're short on cash and want to pay less than the full amount, type the amount you want to pay in the bill's Amt. To Pay cell.

On the other hand, if you want to see bills you can pay early to get a discount, you can choose Discount Date in the Sort By box. Then it lists the bills in ascending order by the discount date. Here is a bill with a discount date in the future, so you can get the discount if you pay it now. When you select that bill you see the discount value to the right of the suggested discount label. To subtract the discount from the amount you owe click Set Discount.

In the Discount and Credits dialog box QuickBooks fills in the discount amount with the early payment discount. Choose the account you want to use for the discount. For an example, an expense account called Vendor Discounts. Click Done. You see the discount in the Discount Used column in the table. You learn how to apply a Vendors Credit in a later lesson. Now that we're back in the Paid Bills window, in the Payment Date box choose the date when you want to pay the bills.

QuickBooks will create the transactions using that date. Then choose the payment method you want to use for the selected bills. In this case, Check or Credit Card. I'll leave it as Check. If you choose Check you can tell QuickBooks to print the checks, or you can assign numbers in QuickBooks for the checks you write by hand. QuickBooks automatically fills in the Account box with your default Checking account. If you want to pay from a different account, choose it in the dropdown list. I'll leave it as Checking.

The program shows the Ending Balance in your account after you pay the bills you've selected. If that number is negative as it is here, you know you have to put more money in the account, or your payments will bounce. When you're ready, click Pay Selected Bills. You can have QuickBooks assign the check numbers for you starting with the next available check number in the register, or you can type the check numbers yourself. In this case I'll let QuickBooks do it. Then, click OK to create the transactions.

QuickBooks creates the payment transactions in your checking account or credit card account, but you still have to send the checks to the vendors or make your credit card payments outside of QuickBooks. If you have more bills to pay you can click Pay More Bills, otherwise, just click Done. If you want to pay other bills using another payment method just repeat these steps and choose the other payment method you want. When you're done paying bills you close the Pay Bill windows and that's all you have to do.