You can record a bounced cheque using an invoice, a cheque, or a journal entry.
The cheque must have been received from a customer for a transaction in which Accounts Receivable was used. For example:
- A cheque entered as a payment through Receive Payment
- A cheque recorded as a Deposit entered on an invoice
- A cheque entered as a Bank Deposit posted to Accounts Receivable
See the following articles for detailed steps to record a bounced cheque using the following methods: