When you run a Profit and Loss report in QuickBooks (using the cash method), you'll see an account called Quickbooks Unapplied Cash Payment Income.
This account usually appears for a variety of reasons, including: if you entered bill payments without connecting them to bills;
Or when a supplier's bill payment is documented before entering the bills.
When you see the Unapplied Cash Bill Payment Expense on your Profit and Loss report, you can take the following steps:
In the open Profit and Loss report, check for the "Unapplied Cash Bill Payment Expense" line at first.
After that, choose the entire amount.
You must also record the provider and the amount for each bill payment in the list.
Select the + New option now.
Then select the Pay bills option.
If you see bills that match the bill payments, select the checkboxes that are next in that list.
When you're finished, click Save.
If you cannot find a matching bill for one of your bill payments, you must recreate it by following these steps:
Select + New Bill
Find the form that has the same amount, provider, and date as your bill payment.
Then click the Save button.
You must repeat the same steps for each bill payment on the list on the left side.
Finally, run your Profit and Loss report again, and you'll notice that the Unapplied Cash Bill Payment Expense account is no longer visible in the report. To put it another way, it had already been removed from your report.