Many times, a user gets a refund for an overpaid order or service or if the vendor did not deliver the full order due to any reason. Mid to Small-sized businesses use QuickBooks Desktop to account for all the business transactions, including refunds from vendors. So, it is important to enter a refund in QuickBooks Desktop, so there are no differences between the QuickBooks records and the bank records. Read the blog till the end for the whole procedure.
“The process to enter a refund in QuickBooks Desktop is not very technical and relatively easy. However, you may need expert assistance if you run into an error while following the given steps. Dial Pro Advisor Solutions’ Support Number 1-(855)-542-9309 anytime and get immediate help”
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Table of Contents
How to Enter Vendor Refund in QuickBooks Desktop?
There are different ways to enter a vendor refund as the nature of the refund varies from user to user. We have mentioned possible situations and the steps to follow to enter a refund in QuickBooks Desktop application.
Situation 1- If the vendor sends a refund check for a paid bill
Below are mentioned the steps to record a refund check from a vendor in QuickBooks.
Make a Deposit of the vendor check
- Open
QuickBooks and head to the Banking
menu. - Click on
Make Deposits and click on OK if the Payment to Deposit window pops up. - Under
the Make Deposits window, click on the received from the drop-down
and select the vendor’s name who sent the refund. - Select From Account drop-down and choose thecorrect Accounts Payable account.
- Mention
the actual amount present on the vendor’s check in the Amount column and fill the other optional fields like a check number, payment
method, memo, etc., if required. - Click on
Save & Close and
Create a Bill Credit for the returned amount
- Go to
the Vendors menu and choose the Enter Bills option. - Click on
the Credit radio button to record the return of goods. - Mention
the Vendor Name and click on the Expenses tab.
Note- If the vendor sends a refund check for returned item, click on Items tab instead.
- Enter
the Accounts on the original bill and fill in the correct
amount for each account under the Amount column. - Click on
Save and Close.
Apply the Deposit to the Bill Credit
- Go back
to the Vendors menu. - Choose
the Pay Bills option and look for the Deposit identical to
the Vendor check amount. - Click on
Set Credits and link the Bill Credit created earlier
in the steps. - Select Done and then Pay Selected
Bills.
Note: The above steps can also be used in case if the vendor sends a refund check that is not related to an existing bill.
Situation 2- If a vendor sends a refund check on behalf of the original Vendor
Make a Deposit for the vendor (not the original vendor) who sent the refund check
- Open
QuickBooks and head to the Banking
menu. - Click on
Make Deposits and select OK if the Payments to Deposit window comes up on the screen. - Choose
the vendor who sent the refund from the Received from drop-down and
click on the correct Accounts
Payable account from the From Account drop-down. - Select
the Amount column and mention the actual amount of the
refund. - Fill in
the rest of the optional fields and click on Save & Close.
Make a bill for the Deposit Amount and post it to the Deposit
- Head
over to the Vendors menu and click on Enter Bills. - Choose
the vendor who sent the refund under the Vendor field and mention
the amount of the refund on the Amount
Due field. - Click on
the Expense tab and choose a Wash Account from the Account field. - Mention
the amount of the refund under the Amount
field and click on Save & Close. - Hover
back to the Vendors menu and click on Pay Bills. - Click on
the Bill and choose Set Credit. - Click on
the Credit and then Done. - Choose Pay Selected Bills and select Done.
Make a Credit for the Original Vendor
- Click on
Enter Bills under the Vendors menu and choose the Credit radio button. - Mention
the original vendor in the Vendor field and enter the refunded amount in the Credit Amount field. - Click on
the Expense tab and choose the account mentioned on the
original bill in the Account field. - Mention
the amount of the refund in the Amount
field and click on Save & Close.
Make a Bill for the Amount of the Credit affecting the Wash Account and apply the Bill to the Credit
- Choose Enter Bills under the Vendors menu and mention the vendor who sent the
refund in the Vendor field. - Mention
the refunded amount in the Amount
field and click on the Expense tab. - Under
the Account field, choose a Wash Account and enter the
amount of the refund in the Amount
field. - Choose Save & Close and head back to the Vendors menu.
- Click on
Pay Bills and choose the Bill and Set Credit. - Select
the Credit option and click on Done. - At last,
click on Pay Selected Bills and then Done.
Situation 3- If the vendor sends the refund as a credit card payment
Below are mentioned the steps to enter credit card refund in QuickBooks.
- Open
QuickBooks and under the Banking menu, click on Enter Credit Card Charges. - Choose
the credit card account from the Credit
Card drop-down. - Click on
the Refund/Credit radio button and select the correct Vendor name. - Mention
the Date, Ref
No., and the Amount. - Describe
the transaction under the Memo field for future references. - Click on
the Item tab and mention the items and the amount
from the refund if the items are returned. If not, click on the Expenses tab. - Choose
the correct Accounts and mention the Amount. - At last,
click on Save & Close.
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While concluding the blog on the steps to enter a refund in QuickBooks Desktop, we hope that the readers will benefit from the steps mentioned above. We have tried our best to make the content easy to understand, but some phrases might be a little difficult to follow. To get an expert assisting you with the process on the line, Pro Advisor Solutions’ Direct Helpline Number 1-(855)-542-9309 anytime.
Erica Watson is writing about accounting and bookkeeping for over 7+ years, making even the difficult technical topics easy to understand. She is skilled at creating content about popular accounting and tax softwares such as QuickBooks, Sage, Xero, Quicken, etc. Erica’s knowledge of such softwares allows her to create articles and guides that are both informative and easy to follow. Her writing builds trust with readers, thanks to her ability to explain things clearly while showing a real understanding of the industry.