Which of the following is a common reason for an overpayment on an invoice?

• A. A mistake by the customer
• B. The customer forgot to subtract a credit note
• C. The customer has paid the same invoice twice
• D. The payment was made in a different currency

Answer: (C)

Overpayment happens when the money received from a customer is more than what the invoice asks for. The most common reason is the customer paying the same invoice twice. When this happens, the extra amount becomes a customer credit that you’ll either refund or hold to apply to a future invoice. In the books, you’d record the full cash receipt, clear the invoice amount from accounts receivable, and create a liability for the excess until you refund it or offset it against another bill.

Other scenarios can also lead to overpayment—such as a mistaken additional payment, not applying a credit note, or a currency mix-up—but paying the same invoice twice is the usual, straightforward cause.