Warranty Shortage / Overage

A common issue with warranty companies is you get a shortage or overage on the payment. This document will show you how to handle payments for those instances.

Handle Shortage from Warranty Credit

Handle Overage from Warranty Credit

Handle Shortage from Warranty Credit

IMPORTANT: These steps cover the process after you have input the warranty credit information from the payment.

If you get a check from the warranty company that is less than the claim amount:

1. Click the Add New Item button in the lower left, below the table.
2. Click into the Claim number field within the new row. This will open a dropdown.
3. Select the claim that the payment is being applied to from the list of A/R claims that have been posted to that warranty company. The system will fill in the full claim amount.
4. Enter the correct payment amount in the GL Credit Amount column on the row.
5. Click the Add New Item button in the lower left, below the table.
6. On the new line, type or select the same claim number. 
7. Enter the difference between the claim amount and the payment amount into the GL Credit Amount field.
8. Enter the warranty overage/shortage GL account into the GL Debit Account field. The shortage amount will be a debit to the expense account.

9. Optionally, you may enter the Warranty Employee who is processing the claim. This is for reporting purposes.
10. Optionally, you may check the Apply Shortage to Warranty Writer box. This is for reporting purposes.
11. Click the button to Mark Completed when finished.

Handle Overage from Warranty Credit

If you get a check from the warranty company that is higher than the claim amount:

1. Click the Add New Item button in the lower left, below the table.
2. Click into the Claim number field within the new row. This will open a dropdown.
3. Select the claim that the payment is being applied to from the list of A/R claims that have been posted to that warranty company. The system will fill in the full claim amount.
4. Click the Add New Item button in the lower left, below the table.
5. Type or select the same claim number.
6. Enter the warranty overage/shortage GL account into the GL Credit Account field. You may want to use the same expense account you have for shortages because these amounts will reduce those expenses.
7. Enter the overage amount into the GL Credit Amount field.

8. Optionally, you may enter comments about the claim payment per line.
9. Optionally, you may enter the Warranty Employee who is processing the claim. This is for reporting purposes.
10. Optionally, you may check the Apply Shortage to Warranty Writer box. This is for reporting purposes.
11. Click the button to Mark Completed when finished.