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wellroom
Level 2

how to correct a merchant service batch transaction that was mis-categorized in QB desktop

Total rookie mistake.  I am hoping for guidance to correct my error.  I am using QB desktop pro 2020.

 

I have deposits from my Intuit merchant services account.  They were included in my bank feed and I inadvertently approved these transactions assigning them to a generic "Merchandise Sales" account.  The originating transactions for the deposits are customer sales through QuickBooks POS.  Now when I run a report my sales are overstated.  Is there a simple way for me to correct?  Is a General Ledger (Journal) adjustment the proper path?

 

(1) QB Desktop has all the QB POS transactions ("Counter Sales") residing in "Undeposited Funds"

(2) My P&L overstates my sales because the customer transactions are reflected as sales as are the merchant services transactions I mistakenly brought in under the Merchandise Sales account.

 

Thanks in advance - hoping to clean this up now so it's not a bigger mess later.

4 Comments 4
ShiellaGraceA
QuickBooks Team

how to correct a merchant service batch transaction that was mis-categorized in QB desktop

You've come to the right place, @wellroom.

 

I have some information about your approved transactions. For the accuracy of your records, you'll have to edit each transaction and correct their accounts. However, if you want to move these amounts to get a correct data of your report, you can create a journal entry.

 

Here's how you can edit each transaction.

 

  1. Go to Accounting and then Chart of Accounts.
  2. Hover towards your Merchant Sales account, and then tick the View register link.
  3. Locate each deposit and then Edit.
  4. Hit Save.

After correcting each transactions, go back to your profit and loss report to see the amounts. For details in creating a journal entry, check out this guide: Create a journal entry in QuickBooks Online.

 

Additionally, you may want to delete or inactivate your merchant sales account and use the undeposited funds account for your deposited sales. Click this link to learn more about it.

 

If you still have questions or concerns, don't hesitate to leave a comment below. I'll be happy to answer them for you. Take care and have a great weekend ahead.

wellroom
Level 2

how to correct a merchant service batch transaction that was mis-categorized in QB desktop

Thanks very much for the reply.  It appears your guidance relates to QuickBooks Online?  My issue is with QuickBooks Desktop and I am not able to follow your solution.  Do you have any guidance for QuickBooks Desktop you can share?

 

Pabz_L
QuickBooks Team

how to correct a merchant service batch transaction that was mis-categorized in QB desktop

Thank you for getting back to us, @wellroom.

 

The information given above is correct. You need to edit each transaction and correct their accounts so you'll have a clean record of data in QuickBooks. 

 

To do this in QuickBooks Desktop, you can follow the steps below:

 

  1. In your QuickBooks Desktop, Go to the Lists tab and select Chart of Accounts.
  2. Click your merchant account, so you’ll be able to see the transaction that has been approved from your bank feeds.
  3. Edit each transaction to correct their accounts.
  4. Once done, click Save & Close.

  

You can also check out this article for more detailed information and when to use a journal entry in QuickBooks. I also recommend seeking advice from your accountant: Journal entry in QuickBooks Desktop.

 

Feel free to visit us at any time if you have any questions about this topic or anything QuickBooks related. I'm always here to help. Have a good one!

wellroom
Level 2

how to correct a merchant service batch transaction that was mis-categorized in QB desktop

Thank you very much for joining this conversation - I'm grateful to have others offering to help fix my error.

 

I think i need to provide a bit more information.

 

When I referred to "merchant account" I was referring to the account for processing credit card transactions, not an account in my GL.  It appears that QB Desktop is set up so that when QB POS processing a customer sale, the transaction is completed in QB POS, the payment is processed, and the transaction is put into QB Desktop with the balancing side of the transaction placed into an account named "undeposited funds" (I'll call it "UF" from now on)  Customer transactions are placed into the UF account individually.  The merchant credit card processing account batches the transactions together and posts the transactions for the day in a single transaction.

 

When I made my mistake, I chose to have the batched deposit placed into the "Merchandise Sales" account in QB.  The result is that the deposit was not matched to the existing customer sales transactions, and my sales were overstated.

 

The UF account is not able to be engaged like other accounts, so I have not been able to create any transactions directly in the account.  The best solution I have identified is the create a General Journal Entry that moves the amount of the deposit out of the "Merchandise Sales" account and into the UF account.

 

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