Vendor sent a check. I need to apply it toward a credit memo. How do I do that?

Thank You!

I used 'Accounts Payable' for the account type, and it cleared it right up! Sure appreciate your help!

Rustler,

This worked perfectly with the Accounts Payable account used in the deposit.  Thank you.

This is the wrong way to do it. This method leaves a plus and minus in the AP. When you run a AP report it shows a balance in the 1-30 day and then a negative amount in the 30-60 column. Then they stay on there forever with the plus and minus.

The actual question here is how do you tell QBO that you overpaid an invoice and the Vendor sent you a check for that amount, and now you are depositing that check?

@timleasley 

"This is the wrong way to do it. This method leaves a plus and minus in the AP."

Actually, it doesn't.  Re-read the post from Rustler.  After assigning A/P to the deposit, you need to go to Pay Bills and clear the credit memo (debit) against the deposit (credit).  That will remove them (the plus and minus) from your A/P Aging reports.  The same process works in QBO.  The overpayment creates a vendor credit and the deposit from the vendor check offsets that.  Clear them against each other in Pay Bills and you're all set.