Welcome to the Community, darren36.
I'm here to guide you in recording this transaction. First, you'll have to enter the vendor credit (USD 769.70) you received. Then, apply it to the open bill. You can check this article for reference: Handle vendor credits and refunds.
Once done, create a bank deposit for the difference that he paid. In the Add funds to this deposit section, make sure to select the vendor who gave you the refund and set Accounts Payable as the account or category. This way, you'll be able to tie this amount to the remaining vendor credit.
Lastly, connect the bank deposit to the vendor credit using the Pay Bills option. Here's how:
- Click the + New.
- Choose Pay bills.
- Select the bank deposit you just created. You’ll see the amount of the vendor credit in the Credit Applied field. The total payment should be $0.00.
- Click Save and close.
For more tips on handling your vendor transactions in QuickBooks Online, you browse a topic from this page: Expenses and vendors.
Feel welcome to reach out to me again with any concerns you may have. I'll be more than happy to assist you again.
