From the Detail Type ▼ dropdown, select Bad debts.From the Account Type dropdown, choose Expenses.At the upper right, click New to create a new account.Go to the Gear icon and then select Chart of accounts.Then, create a Bad debts expense account: Check which outstanding accounts receivable should be written off.Find and open an Accounts Receivable Aging Detail report.Doing so helps us review all your invoices that should be considered bad debt. To start, let's run the Accounts Receivable Aging Detail report. Here are the steps to write off invoice balances. This process helps keep your accounts receivable and net income accurate. If the invoices you send through QuickBooks are no longer collectible, you can classify them as bad debts and remove them from your records. Writing off old unpaid invoices is easy, Charm25. Forgive me if you know all of this already. That why it's easier to just zero out the invoices IMO. On cash basis, you don't increase revenue, so the Product/Service on the credit memo should match the income accounts associated with the invoices. That's correct for accrual basis but not cash. If you assign an expense account to the credit memo, your revenue and expense will both increase, thereby offsetting. On cash basis, when you apply a credit memo to an invoice, QB increases your revenue based on the invoice amounts and then offsets that with whatever accounts are assigned to the Product/Services on the credit memo. If you don't have access to make changes, then, IMO, you should create credit memos that offset the revenue on the invoices, not create an offsetting expense. It will affect any prior period accrual basis reports.

Since you're on cash basis, those entries were never on your balance sheet or P&L so zeroing them out will not impact any cash basis closed period. Can zero out the invoices if you have access to make changes to prior, closed periods.

Qbo apply credit memo to invoice