FAQ: How Do I Pay a Vendor Invoice with a Credit Card?

Paying a Vendor's invoice with a credit card involves four steps. The first three will essentially transfer the balance from the vendor's account to the credit card company's account. The fourth step occurs when you receive your credit card statement and actually pay for the invoice.

1.creating a negative vendor invoice that you will use later to balance out the existing invoice

2.entering an invoice for the credit card vendor

3.removing the invoice balance from the vendor account by issuing a $0 hand check

4.entering the invoice for the credit card statement, minus the amount of the vendor's invoice, and paying both invoices .

1) Creating a negative vendor invoice

1.Select Accounting > Accounts Payable > Invoice Entry.

2.Enter the vendor into the Pay to Vendor field and press Tab.

3.For the invoice number, you may want to enter the number of the actual vendor's invoice preceded or followed by a letter to note that this invoice is being entered to offset the original.

4.Enter the invoice amount as the negative of the actual invoice.

5.In the G/L Distribution section on the right, post the amount of the invoice to the appropriate G/L Expense account. You will need to use this same account when you enter the invoice for the credit card company.

6.When you have entered all of the necessary information, click the Save button to save the invoice.

2) Entering an invoice for the credit card vendor

1.Select Accounting > Accounts Payable > Invoice Entry.

2.Enter the credit card vendor into the Pay to Vendor field and press Tab.

3.The invoice number should be some combination of the original vendor's number and original invoice number, for improved tracking purposes.

4.Enter the amount of the original invoice and, in the G/L Distribution section, post it to the same expense account that you used in step 1.

5.When you have entered all of the necessary information, click the Save button to save this invoice.

3) Removing the invoice balance from the vendor account

1.Select Accounting > Accounts Payable > Check Print.

2.Click the Individual Check button in the bottom toolbar, then click the Hand Check button.

3.Enter the vendor of the original invoice in the Vendor field and press Tab.

4.In the Check Number field, enter a unique reference code for the transaction, since you won't actually be writing a check. Keep in mind that check number cannot be used more than once, so you may want to relate it to the invoice or vendor number (ADJ012345, for example).

5.Then, select only the original invoice and the invoice that you created in step 1. The check amount should be zero.

6.Finally, click the Save & Print button to save the posting and print a voucher for the "check" that you issued. This will remove the balance from the vendor.

At this point, you have closed out the vendor's invoice and transferred the balance to the credit card vendor. This has no effect on your total A/P Balance. When you receive the credit card statement, you need to enter the invoice minus the amount of the vendor's invoice, since that had already been entered as a separate invoice.

4) Entering the invoice for the credit card statement, minus the amount of the vendor's invoice

1.Select Accounting > Accounts Payable > Invoice Entry.

2.Enter the credit card vendor in the Pay to Vendor field and press Tab.

3.Complete the invoice entry process, deducting the amount of the vendor invoice from the credit card statement total.

4.Save the credit card statement invoice. When you pay the invoice, be sure to select the statement invoice and the invoice that you created in step 2.

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