Accounting for Suppliers Paid by Company Credit Card

Example:
$5000 = Visa statement $1000 = Miscellaneous Expenses $4000 = Purchase from Supplier ABC Company

Pay with Computer Check

AP30 Post an invoice to the Vendor ABC for $4000 and distribute to the GL as normal. In the PAY TO field, enter Vendor VISA. This will direct the computer check cycle to pay this invoice to Vendor VISA, not Vendor ABC.

AP30 Post an invoice to Vendor VISA for $1000 for the portion of the statement that represents purchases for miscellaneous expenses.

AP40 The Cash Requirements Report will select both invoices to be paid to Vendor VISA.

AP45 The invoice for vendor ABC will show as paid and will reference the check number that went to vendor VISA. The Payment History details appear under vendor VISA (the Payto Vendor).

Pay with Manual Check

AP30 Post an invoice to the Vendor ABC for $4000 and distribute to the GL as normal.

AP30 Post an invoice to Vendor VISA for $5000. Distribute the expense portion ($1000) to the appropriate Expense GL accounts and the supplier purchases portion ($4000) to a Visa Clearing GL account (in the Liability section of the Chart of Accounts)

AP50 Post manual check to Vendor VISA and pay off the $5000 invoice.

At this point VISA has been paid, vendor ABC still shows an outstanding AP invoice for $4000 and there is a Debit balance in the Visa Clearing account of $4000.

AP50 Use the 'Adjust' function of AP50 to match the balance of the ABC invoice to the balance in the Visa Clearing account. Enter the ABC invoice and Debit the $4000 balance (this brings the outstanding invoice amount to zero); then go to the GL folder and Credit the Visa Clearing account for $4000.

AP45 Vendor VISA shows the $5000 invoice as paid and references the manual check number for the payment. Vendor ABC shows the original invoice as adjusted to zero. The Visa Clearing account in the GL shows a balance of zero.