How to Record a Guaranteed Payment in Quickbooks
Are you trying to record a guaranteed payment? Guaranteed payments are used to provide compensation to partners or other individuals for performing work. While most businesses have employees, some of them have partners as well. These partners aren’t on the business’s payroll. Instead, the business will pay its partners by using guaranteed payments. In Quickbooks, you can record a guaranteed payment in just a few simple steps.
Step #1) Create a Check
The first step to recording a guaranteed payment in Quickbooks is to create a check. You’ll essentially use a check to pay the partner, after which you can choose the option to save it as a guaranteed payment. This is done by selecting the “Banking” menu in Quickbooks Desktop and choosing the “Write Checks” option. From there, you can select the bank account associated with the check from the “Bank Account” menu.
Step #2) Choose the Partner
You’ll also need to choose the partner for whom you are recording the guaranteed payment. As previously mentioned, guaranteed payments are those used to compensate partners, as well as other individuals, who perform work on behalf of your business. You can choose the partner by selecting the “Pay to the Order Of” menu. After selecting this menu, you should see a list of all known partners, vendors and other business associates. Just scroll through the list until you find the partner for whom you are recording the guaranteed payment.
Step #3) Choose the Account
The third step to recording a guaranteed payment in Quickbooks is to choose the account. Assuming you followed the steps listed above, you should see an “Action” column. Under this column is a list of accounts. Choose the guaranteed payment account that you created. Quickbooks will require you to enter some other basic information in the available fields. When finished, select “Save & Close.”
That’s all it takes to record a guaranteed payment in Quickbooks. If you aren’t comfortable recording guaranteed payments yourself, you may want to hire an accountant to do it. Nonetheless, Quickbooks simplifies the otherwise complex task of recording guaranteed payments. It only takes a few steps. Recording a guaranteed payment involves creating a check, choosing the partner and choosing the account. Once recorded, the guaranteed payment will show up your business’s general ledger. Just remember to double-check the partner to make sure it’s correct.
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