Adding Multiple AR/AP Lines on a Single Journal Entry

Bookkeepers often come across a situation where they need to post a journal entry that affects accounts receivable (AR) or accounts payable (AP). Although you would typically enter all transactions affecting AR and AP by creating an invoice or entering a new bill, journal entries that affect these accounts are sometimes necessary. For instance, you might need to set up a new company with beginning balances from a previous set of books or post year-end journal entries provided by an accountant or allocate daily automated clearing house (ACH) deposits.

Workflow Roadblock

Previously, QuickBooks® Online limited the posting of journal entries to one AR or AP transaction per journal entry. That meant if you needed to post a journal entry to multiple AR or AP accounts, you would have to post multiple journal entries or set up a clearing account.

Say you have a daily ACH deposit for 20 clients. You would make one entry for the deposit with a credit to a clearing account, then 20 entries with a debit to a suspense and a credit to the accounts payable account identifying the client. Or, if you were recording opening balances in QuickBooks, you would have to make multiple journal entries to load the balances into AR and AP. You can imagine how time-consuming that would be for a company with hundreds of customers and vendors.

Time-Saving Solution

Now, QuickBooks Online has lifted that restriction. Allowing multiple AR/AP lines in a single journal entry creates a more efficient workflow process, drastically reducing the amount of time required to post journal entries. You'll also save time reviewing, reversing and adjusting existing journal entries.

Steps to Get Started

This tutorial will lead you through the steps to create a journal entry with multiple AR or AP lines in a single journal entry.

1. From anywhere in your QuickBooks company file, click on the "+" in the top center of the screen. For this example, we started from the Home screen.

2. After pulling up the Create menu, select Journal Entry.

3. From the Journal Entry screen, begin entering your journal entry, including date, journal entry number (optional), account, debit or credit amount and a description of the reason for the journal entry. For this example, we're entering opening balances for a new company.

On the far right, you'll see the Name column. Here, you can select the applicable customer (AR) or vendor (AP). If you haven't yet set up your customers and vendors, you can add them here.

4. Your journal entry now includes one vendor, but when you enter opening balances, chances are you'll need to enter multiple AR and AP balances to load the correct balances into each of those accounts. To add more, you just move to the second line of the journal entry and add another line. Use as many lines as you need to complete your journal entry, choosing a customer or vendor associated with each line, where applicable, in the Name column.

5. Once your journal entry is complete, check to make sure you are in balance (the sum of the Debit column equals the sum of the Credit column). From here, you can click Save and New to add another journal entry, or just click Save and then click the "X" in the upper-right corner to close the journal entry screen and return to the Home screen.

Note: If you try to save the journal entry without assigning a customer or vendor to a line that affects AR or AP, you'll receive an error message. You must choose a customer or vendor for any line that affects accounts receivable or accounts payable.

This new functionality is a major improvement over the old workarounds and should dramatically reduce the time it takes to create journal entries that affect multiple AR and AP accounts.

About the Author

Janet Berry-Johnson

Janet Berry-Johnson

I'm a freelance writer and a Certified Public Accountant with nearly two decades experience in accounting and insurance. I write about income taxes, accounting, small business, insurance, credit, saving for college, student loans, and personal finance.

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