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How to correct a banking deposit error?

How should I correct a banking deposit error in QB? The issue: A payment was applied to the customer’s invoice and posted to undeposited funds. However, the check was not included in the deposit when taken to the bank. As a result, the bank issued a deposit adjustment reducing the amount of the deposit by the missing check. What arw the proper steps to clear this matter correctly?

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Best answer 12-10-2018

Accepted Solutions
Established Community Backer ***

"A check should be initiated" To show your QB Account bal...

"A check should be initiated"

To show your QB Account balance is Less than you have already entered.

"and coded to Other Assets"

To show you still own these funds that didn't make the bank, and you will be taking it, later. It is similar to a Bounced Check that is being submitted, again = not in the first Deposit.

You have two scenarios:

Your own deposit was Right in real life, but wrong in the bookkeeping. That means you would open the original deposit and Delete that line, and leave the Payment as Undeposited Funds, to select next time. This is 2 things.

Or;

You Have a Payment Transaction that is part of a Deposit Transaction that Has happened and went through the Bank. Then, the bank reversed that One Piece = yet another transaction. Then, you will do the deposit later. This is 3 things.

Bookkeeping matches reality.

"to reduce the running balance."

To get your records to what the bank shows after the Reversed this deposit amount.

Gross Deposit

Small Reversal

"Once the missing check is deposited to the bank, you said “This is Deposit” "

Banking menu > Deposit. Manually list this on the Next Blank line of the deposit it is part of, or by itself, if it is going by itself.

"and the Other Asset account should be selected as the from account"

To reflect that the amount you are Holding here, is finally "in the bank" for real.

"representing the check being put in the bank, correct?"

Representing the Client's Check finally went to the bank.

"Also when you say This is deposit, did you mean to say this step represents the Deposit?"

This step Is A Deposit entry, and is your Real deposit in real life, for the date you finally actually took that check to the bank.


6 Comments
Established Community Backer ***

"A check should be initiated" To show your QB Account bal...

"A check should be initiated"

To show your QB Account balance is Less than you have already entered.

"and coded to Other Assets"

To show you still own these funds that didn't make the bank, and you will be taking it, later. It is similar to a Bounced Check that is being submitted, again = not in the first Deposit.

You have two scenarios:

Your own deposit was Right in real life, but wrong in the bookkeeping. That means you would open the original deposit and Delete that line, and leave the Payment as Undeposited Funds, to select next time. This is 2 things.

Or;

You Have a Payment Transaction that is part of a Deposit Transaction that Has happened and went through the Bank. Then, the bank reversed that One Piece = yet another transaction. Then, you will do the deposit later. This is 3 things.

Bookkeeping matches reality.

"to reduce the running balance."

To get your records to what the bank shows after the Reversed this deposit amount.

Gross Deposit

Small Reversal

"Once the missing check is deposited to the bank, you said “This is Deposit” "

Banking menu > Deposit. Manually list this on the Next Blank line of the deposit it is part of, or by itself, if it is going by itself.

"and the Other Asset account should be selected as the from account"

To reflect that the amount you are Holding here, is finally "in the bank" for real.

"representing the check being put in the bank, correct?"

Representing the Client's Check finally went to the bank.

"Also when you say This is deposit, did you mean to say this step represents the Deposit?"

This step Is A Deposit entry, and is your Real deposit in real life, for the date you finally actually took that check to the bank.


Established Community Backer ***

"What arw the proper steps to clear this matter correctly...

"What arw the proper steps to clear this matter correctly?"

You have a New activity:

Leave the original deposit as is. Make a "check" for the oversight and on the expenses ta b, post as Other Asset = they make this adjustment, which reduces your own running balance.

Now, when you Make that deposit, you already have the Payment; this is not that payment, again. This is Deposit, and the "from" account is the Other Asset = you finally Put it in the bank.


Not applicable

Just to clarify... A check should be initiated and coded...

Just to clarify... A check should be initiated and coded to Other Assets to reduce the running balance. Once the missing check is deposited to the bank, you said “This is Deposit” and the Other Asset account should be selected as the from account representing the check being put in the bank, correct? Also when you say This is deposit, did you mean to say this step represents the Deposit?
Established Member

Re: "A check should be initiated" To show your QB Account bal...

I understand all steps laid out. But what if the check, which was a stop-payment, which had multiple invoices attached to it as payments? This reverses the invoices to become unpaid again. How would this be handled?

Established Member

Re: "A check should be initiated" To show your QB Account bal...

Hello. I understand all steps that has been mentioned to reverse the check out. What if the check deposited, which was a stop payment, in this case, paid multiple invoices? 23 to be exact. Which returns invoices back to unpaid status. How do I open those invoices back up again? I am thinking next step is a journal entry, but I'm not sure what the process is or how I should do this.

QuickBooks Team

Re: "A check should be initiated" To show your QB Account bal...

Thanks for joining this thread, Basibuyuk.

 

I'm here to help provide some additional information about the invoice transactions in QuickBooks Desktop. 

 

In this case, what you need to do is void the payments that were linked to your invoices, and it will open the paid invoices. To view the list of paid invoices and to easily locate the payments, you can pull up the Transaction List by Customer report. 

 

Here's how:

  1. Go to Reports at the top menu, and select Customers & Receivables.
  2. Choose Transaction List by Customer.
  3. Click the Customize Report button, and go to the Filter tab.
  4. Search for Transaction Type, and select Invoice, Payment, and Deposit.
  5. Click the OK button.

Once done, you can now open the invoice payment and select Delete to mark the invoice to unpaid status. 

 

For additional reference, you can check these articles:

Please know that I'm just a post away if you have any other questions about the invoice transactions. Have a good one.