Recording an erroneous refund

MonicaG · ‎April 02, 2019

A customer's account was mistakenly credited $100 instead of being debited that amount (for an invoice payment) via our ACH system. When the mistake was discovered, we debited that $100 sent in error, plus they were debited $100 for their invoice. So first we transferred $100 out of our account and then we received $200 in our account.

Unfortunately, the two transactions happened in different months. The credit was effected at the end of March, so the deduction of $100 shows on our March statement. The $200 credit posted to our account on April 1. So how do I record that initial mistake and the reversal so that both March and April reconcile?

Anonymous · ‎April 02, 2019

Hi, @MonicaG.

It's nice to see you again in the Community. I'd be glad to help record these transactions in QuickBooks so you can reconcile both your March and April statement.

You can use a clearing account in recording these transactions. A clearing account can be used when you cannot move the money directly. Please refer to this article for the steps in setting up a clearing account: Set up a clearing account.

Then, you'll have to create a check for the deduction showing on your march statement. Make sure to select the clearing account on the Expenses tab.

Then make a deposit for the April statement using the clearing account and A/R.

This will zero out your clearing account. Then the remaining amount can be applied to your customer's next payment.

That should do it. You'll be able to reconcile your transactions after following this process.

If you need more references in the future, you can always visit our site: Help articles for QuickBooks Desktop.

Keep me posted if you have additional questions about using the clearing account. I'll be here to help however I can.

View solution in original post

Anonymous · ‎April 02, 2019

Hi, @MonicaG.

It's nice to see you again in the Community. I'd be glad to help record these transactions in QuickBooks so you can reconcile both your March and April statement.

You can use a clearing account in recording these transactions. A clearing account can be used when you cannot move the money directly. Please refer to this article for the steps in setting up a clearing account: Set up a clearing account.

Then, you'll have to create a check for the deduction showing on your march statement. Make sure to select the clearing account on the Expenses tab.

Then make a deposit for the April statement using the clearing account and A/R.

This will zero out your clearing account. Then the remaining amount can be applied to your customer's next payment.

That should do it. You'll be able to reconcile your transactions after following this process.

If you need more references in the future, you can always visit our site: Help articles for QuickBooks Desktop.

Keep me posted if you have additional questions about using the clearing account. I'll be here to help however I can.

MonicaG · ‎April 12, 2019

That did the trick!! Thanks so much!

MorganB · ‎April 12, 2019

I'm glad to hear this worked for you, MonicaG! The Community is always in your corner if you ever need assistance again in the future. Take care.

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Recording an erroneous refund