diff --git a/packages/server/src/database/migrations/20240722085204_amount_applied_column_to_payments_received_table.js b/packages/server/src/database/migrations/20240722085204_amount_applied_column_to_payments_received_table.js
index 32b8ae9fb..2643bcd2e 100644
--- a/packages/server/src/database/migrations/20240722085204_amount_applied_column_to_payments_received_table.js
+++ b/packages/server/src/database/migrations/20240722085204_amount_applied_column_to_payments_received_table.js
@@ -1,7 +1,6 @@
 exports.up = function (knex) {
   return knex.schema.table('payment_receives', (table) => {
-    table.decimal('unapplied_amount', 13, 3).defaultTo(0);
-    table.decimal('used_amount', 13, 3).defaultTo(0);
+    table.decimal('applied_amount', 13, 3).defaultTo(0);
     table
       .integer('unearned_revenue_account_id')
       .unsigned()
@@ -12,8 +11,7 @@ exports.up = function (knex) {
 
 exports.down = function (knex) {
   return knex.schema.table('payment_receives', (table) => {
-    table.dropColumn('unapplied_amount');
-    table.dropColumn('used_amount');
+    table.dropColumn('applied_amount');
     table.dropColumn('unearned_revenue_account_id');
   });
 };
diff --git a/packages/server/src/services/Sales/PaymentReceives/AutoApplyUnearnedRevenue.ts b/packages/server/src/services/Sales/PaymentReceives/AutoApplyUnearnedRevenue.ts
index 2982002ec..bf38f10ab 100644
--- a/packages/server/src/services/Sales/PaymentReceives/AutoApplyUnearnedRevenue.ts
+++ b/packages/server/src/services/Sales/PaymentReceives/AutoApplyUnearnedRevenue.ts
@@ -31,26 +31,27 @@ export class AutoApplyUnearnedRevenue {
   ): Promise<void> {
     const { PaymentReceive, SaleInvoice } = this.tenancy.models(tenantId);
 
-    const unappliedPayments = await PaymentReceive.query(trx).where(
-      'unappliedAmount',
-      '>',
-      0
-    );
     const invoice = await SaleInvoice.query(trx)
       .findById(saleInvoiceId)
       .throwIfNotFound();
 
+    const unappliedPayments = await PaymentReceive.query(trx)
+      .where('customerId', invoice.customerId)
+      .whereRaw('amount - applied_amount > 0')
+      .whereNotNull('unearnedRevenueAccountId');
+
     let unappliedAmount = invoice.total;
-    let appliedTotalAmount = 0;
+    let appliedTotalAmount = 0; // Total applied amount after applying.
 
     const processHandler: ProcessHandler<
       IPaymentReceive,
       Promise<void>
     > = async (unappliedPayment: IPaymentReceive, index: number, pool) => {
-      const appliedAmount = Math.min(unappliedAmount, unappliedAmount);
+      const appliedAmount = Math.min(unappliedAmount, unappliedPayment.amount);
       unappliedAmount = unappliedAmount - appliedAmount;
       appliedTotalAmount += appliedAmount;
 
+      // Stop applying once the unapplied amount reache zero or less.
       if (appliedAmount <= 0) {
         pool.stop();
         return;
@@ -108,7 +109,7 @@ export class AutoApplyUnearnedRevenue {
       invoiceId,
       paymentAmount: appliedAmount,
     });
-    await PaymentReceive.query(trx).increment('usedAmount', appliedAmount);
+    await PaymentReceive.query(trx).increment('appliedAmount', appliedAmount);
 
     // Triggers the event `onPaymentReceivedUnearnedRevenue`.
     await this.eventPublisher.emitAsync(
diff --git a/packages/server/src/services/Sales/PaymentReceives/PaymentReceiveDTOTransformer.ts b/packages/server/src/services/Sales/PaymentReceives/PaymentReceiveDTOTransformer.ts
index df47ab14a..dc13c44e8 100644
--- a/packages/server/src/services/Sales/PaymentReceives/PaymentReceiveDTOTransformer.ts
+++ b/packages/server/src/services/Sales/PaymentReceives/PaymentReceiveDTOTransformer.ts
@@ -37,7 +37,6 @@ export class PaymentReceiveDTOTransformer {
     oldPaymentReceive?: IPaymentReceive
   ): Promise<IPaymentReceive> {
     const appliedAmount = sumBy(paymentReceiveDTO.entries, 'paymentAmount');
-    const unappliedAmount = paymentReceiveDTO.amount - appliedAmount;
 
     // Retreive the next invoice number.
     const autoNextNumber =
@@ -55,7 +54,7 @@ export class PaymentReceiveDTOTransformer {
       ...formatDateFields(omit(paymentReceiveDTO, ['entries', 'attachments']), [
         'paymentDate',
       ]),
-      unappliedAmount,
+      appliedAmount,
       currencyCode: customer.currencyCode,
       ...(paymentReceiveNo ? { paymentReceiveNo } : {}),
       exchangeRate: paymentReceiveDTO.exchangeRate || 1,