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Refund From Vendor For Overpayment

Forum|Forum|7 years ago
January 10, 2019
41 replies
156 views

Two invoices were overpayed and my vendor submitted a refund check. How do I enter that refund so that it offsets the overpayment?

QuickBooks Online

Best answer by Rustler

deposit the check and use accounts payable as the source account for the deposit, use the vendor name too

bring up pay bills, select the bill that the deposit created and apply the vendor credits, save

RustlerAnswer

Level 15

deposit the check and use accounts payable as the source account for the deposit, use the vendor name too

bring up pay bills, select the bill that the deposit created and apply the vendor credits, save

T

TK54

The Bill for a Vendor was $2,448.00 & the payment via debit card = $2,548.00

I allocated the payment from the Bank account to the Vendor account & paid the Bill but there is a $100 on the Vendor account showing as an overpayment.

The Vendor then refunded the $100 to our Bank account.

What is the best way to clear the $100 on the Vendor account & where should I allocate the refunded $100.

I am working on Quickbooks online

MaryLurleenM

Level 6

You've come to the perfect place to make sure that refund is recorded correctly, TK54.

To avoid getting a negative balance for your vendor, let's follow the correct process of recording a vendor refund in the system.

Click the Plus icon (+).
Choose Bank Deposits.
In the Deposit To drop-down, select the account where the money will be deposited.
Type in the Date.
Enter these fields:
- Received From: Choose the vendor who sent you the refund.
- From Account: Select the Accounts Payable account or the account used in the expense transaction.
- Amount: Enter the vendor check amount.
- Memo, Chk No, and Pmt Meth are optional fields.
Click Save and Close.

Once a deposit is entered, you'll see a positive balance in your vendor's information page. To zero it out, you'll need to link the deposit to a vendor credit. Here's how:

Go to the Plus icon (+).
Select Expense or Check.
Choose the payee.
Once you select a payee, you'll see a window on the right corner of the screen showing the deposit transactions you've created.
Click on Add.
Click Save and Close.

For additional insights, check out these articles:

Please don't hesitate to reach out to us again if you have other questions in mind.

B

bjd90

If you already have the bill and the original payment entered into QuickBooks as I had, it seems easier to not to delete the original bill.

Go to: Banking/Make Deposits

Enter Vendor name. Use the Accounts Payable account associated with the bill. Unless you use more than one A/P account, it will probably be just Accounts Payable.

Deposit check.

Go to Vendors/Pay Bills.

You will see a new bill in the list that has been created by your deposit.

Select bill, click 'Apply Credits', and apply credit to bill created by your deposit.

In my case, the original bill and the refund happened in different reporting periods.

K

Kelleen3

I do not have the option to choose Accounts Payable to apply the refund to. I also cannot add Accounts Payable or Office Expense. Please help! I do not know what to do at this point, all the various methods described online say to apply to accounts payable, which I cannot do.

C

Carneil_C

Level 6

Thanks for dropping by the Community, @Kelleen3. Allow me to chime in and help you with sorting this issue with QuickBooks Desktop.

Accounts Payable can also be applied to checks and deposits.

Please see this sample screenshot for reference:

Otherwise, users may experience discrepancies in their company files as a result of data damage. You can use the Verify and Rebuild tools to get this resolved. Also, please ensure that your QuickBooks Desktop is updated.

Here’s how:

Go to Window, then Close All.
From the File menu, click Utilities.
Select Rebuild Data.
Follow the on-screen instructions to back up your data.
When the tool finishes, select OK.
Go to the File menu, then click Utilities.
Click Verify Data, then select Rebuild Now once QuickBooks finds an issue with your company file.

Furthermore, I'm also adding this article for more troubleshooting steps: Fix data damage on your QuickBooks Desktop company file.

I’ll also provide this link to guide you further on how to record vendor refunds in QBDT.

In addition, you can refer to this article for a complete list of workflows and other vendor-related transactions in QBDT.

Keep me posted if you still have questions or concerns with managing your transactions in QBDT. I'll be around for you. Have a great day!

T

Twhitt

All of my medical expenses were paid to this vendor in 2022. I received an overpayment refund check in January 2023. I need instructions that will show (1) a deposit to the bank, (2) the P&L for 2023 to show a negative amount for that refund (it is the only medical expense recorded this year so far), and (3) I would like the bank to be debited. I am using an old desktop version: Premier Retail 2007

Thank you.

T

Twhitt

Ignore my question. I deleted it all and just did a JE debiting the bank and crediting the medical expense account, and put the vendor name in the bank debit column. Worked perfectly. It shows the refund in the bank, on the P&L and in the vendor history.

K

Kurt_M

QuickBooks Team

I appreciate you for joining the thread, @ABCCO.

Please know that you can't create a bill through the deposit. Instead, you can use the deposit as a credit and then apply it to your bill transaction to settle it. If you're referring to this process, I'll gladly input the steps below to get you going. To begin, here's how:

Access your QuickBooks Desktop company.
Go to the Banking menu, and then select Make Deposits.
In the Received From section, choose the correct vendor.
In the From Account section, select Accounts Payable.
Enter the Amount, and then click the Save & Close button.

If you don't have an existing bill, you'll want to create one. See this page for further guidelines: Enter bills in QuickBooks Desktop.

Once done, click the Pay bills button inside the bill you created, and then select the deposit you made earlier. You'll then click the Set Credits button below and choose your deposit. Click Done to apply.

Additionally, you can also check this page to help you manage your bills inside QBDT: Pay bills in QuickBooks Desktop.

@ABCCO, I'll be here in the Community space if you need further assistance accomplishing this task. Please don't hesitate to leave a comment below. I'll get back to you right away. Stay safe!

T

Twhitt

Kurt

Your answer is absurd! The guy got a refund check. You deposit it. You do not issue a credit memo against it to apply to the next bill. You do not create an invoice to use it up. He overpaid the vendor. He already paid the original bill but wrote the check for too much money and they reimbursed him. You simply make a journal entry as I've posted. Why in the world would you EVER make an invoice against money you already paid an invoice on but over paid it? That's really bad accounting.

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