You're on the right track, Michelle.

As mentioned above, the location that you set for the bill will be automatically added to the bill payment.

Since you've already assigned locations (divisions) to your bills, we'll just have to retrigger the payment to apply the changes that you've made. I'll show you how:

1. Select Reports from the sidebar menu, then choose Statement of Financial Position from the Business Overview section.
2. Click the Customize button. 
3. Set the appropriate Report period and Accounting method. 
4. Go to Filters, then select the desired location from the Location drop-down menu.
5. Hit Run Report, then select the amount to open the Transaction Report.
6. Select the Gear or Gog icon, then add the Location column.
7. Choose Location from the Group by drop-down menu, then click the bill payment to open it.
8. Uncheck the bill, then add it again.
9. Click Save and close to complete the process.

Once done, all the payments in the Total for Not Specified section will be categorized into the appropriate locations (see below).

You'll want to consider memorizing this report to save its current customization settings.

Additionally, I encourage running these popular custom reports in QuickBooks Online to get awesome insights about your business.

If I can be of any additional assistance, please don't hesitate to insert a comment below. Stay safe and have a pleasant day ahead.