I made a deposit that cleared my bank rec in October, however that money should have never been transferred. So I transferred the money back out of that account in November. How do I reflect this correctly in QuickBooks, since that initial deposit already cleared? I am not sure what kind of entry to make.
You can make an expense entry to record the deposit that you've transferred back out to the same account in QuickBooks Online. You've got me here to help you achieve this goal.
Creating an expense is the right thing to do since the money has been moved out of the account. This will offset the cleared deposit and record the process accordingly in the system. Know that in doing this, you'll need to use the same account where the money was cleared.
To do that:
Click on the +New button.
Press on Expense.
Select where the deposit is coming from in the Payee box.
Choose the bank account where the money will be taken out in the Payment account section.