Vendor Bills

krucki · ‎January 16, 2019

I have vendor that we over paid and requested a refund from. I have a feeling we may not see the refund for a while. How am i able to create a bill for this vendor? If i make them a customer account, then i wont be able to apply it against the correct "product/ service" account. How can I keep track of this/ show an open balance?

AldrinS · ‎January 16, 2019

Hi there, krucki.

You've come to the right place. I have just the steps that'll help keep track of the overpayment.

You wouldn't need to make them a customer account. Instead, I'd recommend recording a vendor credit. With this, you'll be able to keep track of the refund and show an open balance for the vendor.

Also, I appreciate that you mentioned where you want to apply this against. That said, let me walk you through the steps on how to create it:

To record a vendor credit in QuickBooks Online

Click the Plus (+) icon.
Select Vendor Credit.
From the Choose a vendor drop-down menu, make sure to pick the correct vendor.
Enter the Payment Date.
In the Category section, fill in the necessary information on the following fields:
- Category: Enter the correct "product/service" account.
- Description: You can leave this field blank.
- Amount: Enter the refund amount that you requested.
Click Save and close.

We're almost done. Now, once you've received the refund from the vendor. You'll need to link it to the credit, here's how:

Enter a deposit to record the refund

Click the Plus (+) icon.
Select Bank Deposit.
In the Add other funds to this deposit section, fill in the following fields:
- Received from: Select or enter the vendor name.
- Account: Select the Accounts Payable account.
- Amount: Enter the check amount.
Click Save and close.

Link the deposit to the credit

Click the Plus (+) icon.
Select Check.
From the Choose a vendor drop-down menu, make sure to pick the correct vendor.
In the Add to Check section, click Add for the Deposit and Vendor Credit respectively.
- If you try to add the credit first, you will receive a You must select a bill before adding a credit warning.
Click Save and close.

All of this information and more is available in our guide on how to handle vendor credit and refunds.

That should do it. With these resources, I'm confident you'll be to record the vendor refund like a pro in no time!

Keep in touch with me here should you need any additional assistance, I'm always around to lend a hand. Thanks for coming to the Community, wishing you and your business only the best.

View solution in original post

AldrinS · ‎January 16, 2019

Hi there, krucki.

You've come to the right place. I have just the steps that'll help keep track of the overpayment.

You wouldn't need to make them a customer account. Instead, I'd recommend recording a vendor credit. With this, you'll be able to keep track of the refund and show an open balance for the vendor.

Also, I appreciate that you mentioned where you want to apply this against. That said, let me walk you through the steps on how to create it:

To record a vendor credit in QuickBooks Online

Click the Plus (+) icon.
Select Vendor Credit.
From the Choose a vendor drop-down menu, make sure to pick the correct vendor.
Enter the Payment Date.
In the Category section, fill in the necessary information on the following fields:
- Category: Enter the correct "product/service" account.
- Description: You can leave this field blank.
- Amount: Enter the refund amount that you requested.
Click Save and close.

We're almost done. Now, once you've received the refund from the vendor. You'll need to link it to the credit, here's how:

Enter a deposit to record the refund

Click the Plus (+) icon.
Select Bank Deposit.
In the Add other funds to this deposit section, fill in the following fields:
- Received from: Select or enter the vendor name.
- Account: Select the Accounts Payable account.
- Amount: Enter the check amount.
Click Save and close.

Link the deposit to the credit

Click the Plus (+) icon.
Select Check.
From the Choose a vendor drop-down menu, make sure to pick the correct vendor.
In the Add to Check section, click Add for the Deposit and Vendor Credit respectively.
- If you try to add the credit first, you will receive a You must select a bill before adding a credit warning.
Click Save and close.

All of this information and more is available in our guide on how to handle vendor credit and refunds.

That should do it. With these resources, I'm confident you'll be to record the vendor refund like a pro in no time!

Keep in touch with me here should you need any additional assistance, I'm always around to lend a hand. Thanks for coming to the Community, wishing you and your business only the best.

krucki · ‎January 17, 2019

This makes sense. Thanks so much!

Anonymous · ‎February 17, 2019

When I follow the steps you suggested the vendors account is credited twice for the refund. Once for the vendor credit and once for the deposit. When I make the check to link the two it posts a zero balance to 0.00 in the total column on the vendor account. There are also opposing entries in an unapplied cash bill payment expense account on the profit and loss statement. What is happening and why?

Anonymous · ‎February 17, 2019

When I follow these instructions I notice that the vendor account is credited twice, once for the vendor credit and once for the deposit. When I make the check to link the credit and deposit it shows up in the vendor account as a 0.00 total. Also, there are entries put into the unapplied cash bill payment expense account on the P&L. There should be a much simpler way to handle vendor refunds. I also have issues with prepayments to vendors ending up in the unapplied cash bill payment expense account on the P&L. Is there a way to handle these where they don't cause these issues?

Anonymous · ‎February 17, 2019

Hello tdclewette,

Thanks for the clarification.

There are three things that you'd need to do before receiving the vendor refund in QuickBooks Online.

Create a vendor credit.
Make a deposit and use the A/P account in the accounts column.
Apply the vendor credit and deposit to offset by creating a check.

When you say that the vendor's account is credited twice, you might want to double-check the Check you've created. It's possible the credit wasn't selected causing the refund amount to be recorded twice.

With this process, the system will create an Unapplied Cash Bill Payment Expense account in your Profit and Loss report. It shows the vendor credit and the deposit transactions. This account should show zero balance.

For now, there isn't a vendor refund function just like the Refund Receipt function for customers. I'd recommend sending feedback about it by clicking on the Gear icon and selecting Feedback.

If you need anything else, please let us know. We're here to help.

Anonymous · ‎February 18, 2019

Here are screen shots of what I did and the results.

Anonymous · ‎February 18, 2019

I have attached screenshots of what I did and the results. Please advise.

Anonymous · ‎February 18, 2019

Welcome back, tdclewette.

Thanks for the additional details you've provided. When I checked the attachment, it looks like you've followed the recommended steps correctly.

In the vendor's profile, there will be 3 transactions, the Deposit, Vendor Credit, and the Bill Payment (Check). The check's total amount is zeroed out because of the deposit and vendor credit. You can also see that the vendor balance is showing the correct amount. There's no need to worry about. The screenshots look right.

Should you have any questions, please let us know. We're here to help.

Anonymous · ‎February 19, 2019

I am attaching two screenshots of the vendor account showing all transactions and balance. When I add all debits together it totals 7969.67 which is what was spent with this vendor. I then add all the credits which should only be one credit per return (vendor credit) my vendor balance should be 7801.75. The vendor credits are being subtracted twice, once for the credit and then again for the deposit hence ending up with an incorrect vendor balance. This appears to be a flawed way of handling vendor refunds.

Anonymous · ‎February 19, 2019

Oops forgot the attachments on the last reply.

Alessandra_B · ‎February 19, 2019

Hello @Anonymous,

Thank you for providing us the screenshot of your vendor balance.

When you apply a vendor credit and deposit to a bill, the balance is already zeroed out. The amount you’re seeing on the total is a visual effect on the vendor. But in the account associated with the transaction, the credit and the deposit will both offset.

You can also check the Transaction List by Vendor report to verify the transactions. Here’s how:

On the left panel, click on Reports.
Look for Transaction List by Vendor on the search bar.
Update the Report period, click on Run Report.

You can also Customize the report to add more columns to the report. Then click on Save Customization to save it in the Custom Reports tab.

As my colleague has mentioned above, the vendor balance is showing the correct amount.

Let me know if you have any other concerns. I’ll be here to help you.

rmaguiba · ‎April 23, 2020

Hello,

I am trying to reconcile an account for a friend who is using Quickbooks Online.

Bank transactions are downloaded and accepted but for check payments they were not

matched to vendor bills. My problem is the bills that these checks were supposed to be payments for

are no longer in the outstanding transactions list when I tried to change the category on these

check payments to A/P.

Any suggestions on how to resolve this so the check payments are properly applied to the right vendor.

I would like to avoid recreating the bill since I am not familiar with the transactions.

Thanks.

How do I correct this?

I changed the category on the check to A/P but could no longer find

the unpaid bill in the outstanding transactions list.

RenjolynC · ‎April 23, 2020

I'd like to help you get the transactions sorted out, rmaguiba.

It looks like the checks were not linked to the bills. Let's go make a bill payment by following these steps:

Go to Expenses > Vendors.
Select the vendor's name, and find the bill.
Click the Make payment link under the Action column.
Choose the bank account from Bank/Credit account drop-down and select the Payment date.
Under the Outstanding Transactions section, select both Bill and Check.
Hit the Save and close button.

Please see this sample screenshot for reference:

Once done, go back to the Banking page and match the transactions.

I'm also adding this article that you can bookmark: Assign, categorize, edit, and add your downloaded banking transactions.

If you need more help with matching the transactions, please let me know. I'm just a few clicks away. Take care.

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