Thank you for dropping by the Community. I see that you want to use the amount due to XXX in current liability as a payment method to settle the bill or expenses. You have arrived at the right place. I'll share information and guidelines to help you with this.

In QuickBooks Online, you cannot directly use a liability account as a payment method to settle bills or expenses. This is because liability accounts represent debts owed by the company and are not intended for use as payment accounts.

To work around this, you can create a new asset account and transfer the amount due to XXX from the current liability account to the new asset account. It will allow you to use the new asset account as a payment method to record the payment on behalf of the subsidiary. Here's how:

1. Go to Settings ⚙ and select Chart of Accounts.
2. Pick New to create a new account.
3. In the Account Type ▼ dropdown, choose an account type.
4. In the Detail Type ▼ dropdown, choose the detail type that best fits the transactions you want to track. Learn more about detail types.
5. Give your new account a name. 
6. If this is a subaccount of an existing account, select Is sub-account and then enter the parent account. Learn more about parent accounts and subaccounts.
7. Now let's ensure the account in QuickBooks matches your real-life bank or credit card account. Choose when you want to start tracking your finances. In the Balance field, enter the amount in the account, and determine the as of date. Enter today's date if you want to start tracking immediately.
8. Click Save and Close.

You can use a journal entry to transfer the amount from the current liability account to the new asset account. Debit the current liability account and credit the new asset account with the same amount. I also suggest seeking guidance from your accountant to assist you with the process of creating Journal Entries.
 

I'm adding these articles you can use in the future:

• Add an account to your chart of accounts in QuickBooks Online.
• Create subaccounts in your chart of accounts in QuickBooks Online.

By creating a new asset account and transferring the amount, you can effectively use it as a payment account while still maintaining accurate accounting records for the liability owed to XXX. If you have further QuickBooks-related concerns, I'll be around to answer them ASAP! Have a great day ahead!