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Refund From Vendor For Overpayment

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

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Best answer 01-10-2019

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Established Community Backer ***

Re: Refund From Vendor For Overpayment

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

5 Comments
Established Community Backer ***

Re: Refund From Vendor For Overpayment

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

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Re: Refund From Vendor For Overpayment

What do I do if no credits are there to apply?

QuickBooks Team

Re: Refund From Vendor For Overpayment

We can run the Open Balance vendor report to see if there's an unapplied credit or overpayment, eas22487. 

 

In the Vendor Center, right-click on the vendor's name and select Open Balance: (Vendor's Name). If the unapplied credit is showing on the report and doesn't show when applying credit, there might be a data damage. Let's run the verify rebuild data utility to fix this. 

 

However, if it didn't show on the report, we can open the Bill Payment to delete and then recreate. The credit should now show on the Apply Credits window. 

 

Let me know if you need more help with applying vendor refunds or credit. I'm here to help you!

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Re: Refund From Vendor For Overpayment

Hi Catherine, 

 

Thanks for the quick reply! When I ran the open balance report for the vendor I do not see a credit. When you say delete the "Bill Payment" do you mean the item that is sitting in the "Pay Bills" section? When recreating should I use record deposit as I had done originally?

 

Thanks again!!

 

QuickBooks Team

Re: Refund From Vendor For Overpayment

You’re on the right track, @eas22487.

 

Let’s first delete the bill and ensure to record the vendor refund so you’ll be able to apply it as credit.

 

To delete the bill:

  1. Go to Vendors.
  2. Choose Vendor Center.
  3. Select the vendor's name.
  4. Double-click the bill payment, bill or credit.
  5. Press Ctrl and at the same time to delete.
  6. Select OK to confirm.

Once deleted, let's record the vendor refund. Here's how:

  1. Click Banking.
  2. Choose Make Deposits.
  3. Select the specific Deposit To bank account where the funds were initially posted.
  4. Type in the name of the vendor in the Received From column.
  5. Choose Accounts Payable as the account affected.
  6. Enter the payment method and the amount of the refund.
  7. Click Save and Close.   

Once recorded, recreate the bill and apply the credit, here's how:

  1. Go to Vendors.
  2. Choose Vendor Center.
  3. Click New Transaction drop-down.
  4. Select Pay Bills.  
  5. In the Pay Bills window, select Show all bills.
  6. Choose the specific AP account.
  7. Put a check mark on the deposit you've recorded.
  8. Click Set Credits.  
    1. In the Discount and Credits window, choose Credit tab.
    2. Put a check mark on the credit that you've created.
    3. Click Done.
  9. Hit Pay Selected Bills.aq.gif

You can now see a zero balance in your Open Balance Report.

 

Also, you can check these articles for additional insights:

Always feel free visit us here in the Community if you have other questions. I’m always here to help.

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