Easiest Method to Enter a Refund in QuickBooks Explained

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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 QuickBooks Technical Support Number 1-(855)-856-0042 anytime and get immediate help”

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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

1. Open QuickBooks and head to the Banking menu.
2. Click on Make Deposits and click on OK if the Payment to Deposit window pops up.
3. Under the Make Deposits window, click on the received from the drop-down and select the vendor’s name who sent the refund.
4. Select From Account drop-down and choose thecorrect Accounts Payable account.
5. 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.
6. Click on Save & Close and

Create a Bill Credit for the returned amount

1. Go to the Vendors menu and choose the Enter Bills option.
2. Click on the Credit radio button to record the return of goods.
3. 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

1. Go back to the Vendors menu.
2. Choose the Pay Bills option and look for the Deposit identical to the Vendor check amount.
3. Click on Set Credits and link the Bill Credit created earlier in the steps.
4. 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

1. Open QuickBooks and head to the Banking menu.
2. Click on Make Deposits and select OK if the Payments to Deposit window comes up on the screen.
3. 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.
4. Select the Amount column and mention the actual amount of the refund.
5. 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

1. Head over to the Vendors menu and click on Enter Bills.
2. Choose the vendor who sent the refund under the Vendor field and mention the amount of the refund on the Amount Due field.
3. Click on the Expense tab and choose a Wash Account from the Account field.
4. Mention the amount of the refund under the Amount field and click on Save & Close.
5. Hover back to the Vendors menu and click on Pay Bills.
6. Click on the Bill and choose Set Credit.
7. Click on the Credit and then Done.
8. Choose Pay Selected Bills and select Done.

Make a Credit for the Original Vendor

1. Click on Enter Bills under the Vendors menu and choose the Credit radio button.
2. Mention the original vendor in the Vendor field and enter the refunded amount in the Credit Amount field.
3. Click on the Expense tab and choose the account mentioned on the original bill in the Account field.
4. 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

1. Choose Enter Bills under the Vendors menu and mention the vendor who sent the refund in the Vendor field.
2. Mention the refunded amount in the Amount field and click on the Expense tab.
3. Under the Account field, choose a Wash Account and enter the amount of the refund in the Amount field.
4. Choose Save & Close and head back to the Vendors menu.
5. Click on Pay Bills and choose the Bill and Set Credit.
6. Select the Credit option and click on Done.
7. 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.

1. Open QuickBooks and under the Banking menu, click on Enter Credit Card Charges.
2. Choose the credit card account from the Credit Card drop-down.
3. Click on the Refund/Credit radio button and select the correct Vendor name.
4. Mention the Date, Ref No., and the Amount.
5. Describe the transaction under the Memo field for future references.
6. 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.
7. Choose the correct Accounts and mention the Amount.
8. 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, QuickBooks Direct Helpline Number 1-(855)-856-0042 anytime.