The purpose of this help file is to provide instructions on how to enter bills (tracking aged payable) and bill payments.

The reason why a business would want to track their bills (or aged payable) may be a matter of cash flow.  The key in maintaining good cash flow is to get paid as soon as possible and pay the bills as late as possible.  Often times when a business receives an invoice from another business, it becomes a bill.

Clarity Accounting Enter Bill View

Required data entry fields

Date: When did you receive the invoice / bill?
Vendor: Who sent you the invoice / bill?
Invoice #: What was the invoice number on the invoice you have received?
Terms or Payment Account: Is there a payment due date on the bill / invoice (an unpaid bill)? Is this a bill that is coming out of your Visa or Bank Account (a bill that has already been paid)?
Once you have selected a terms of payment, the due date will be automatically entered for you.
Expense Account: Every expense / bill is associated with an expense account / category for tax deduction purposes.
Description: This is an optional field for you to enter the description of the bill / expense.
Price: How much is the bill?
Sales Tax: Did the bill come with sales taxes included?
Currency: If you are receiving an invoice from other countries or if you are expected to pay in other currencies, you can use this tab to enter multi-currency transactions.

Case Study

ABC company is based in the US.  It hired Habitsoft, Inc to do some custom development work for them.  Habitsoft billed ABC company for 40 hours of work at $100 / hour.  The invoice date is October 21, 2008 and the terms of the invoice is for the invoice to be paid in full within 30 days (term 30).  Since Habitsoft is a Canadian company, they would like to be paid in Canadian dollars.

As you can see from the sample data entry fields above, by filling in the exchange rate, our online accounting software automatically does the calculation that shows the total bill amount to be $4000 CDN — which works out to be $3200 USD on October 21, 2008.  You can get daily updated currency exchange rates on XE.com.

Recording Bill Payments

Once a bill has been paid, then you can go into the “Pay Bill” tab to enter a bill payment.  Alternatively, you can also find this bill in your list of bills/ expenses and enter a bill payment through the summary page.

Using the same case study we have been using in this help file, we will record a payment for Habitsoft Inc.

Please note: It is important for you to select the Vendor and the correct “currency” in order for an outstanding invoice to show up on the “pay bill” section.

When you record a bill payment, please enter the date you paid the bill and which bank / credit card account it is coming out of.  In this case, Habitsoft, Inc was paid $4000 CDN on October 23, 2008 with Paypal.

More Questions?

If you have any questions regarding how to enter bill and bill payment records, please do not hesitate to contact us.