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Level 1

What is my next step after entering a vendor refund in make deposits?

We paid a bill for inventory items + shipping to our vendor, I have already entered the payment under "write checks" to the vendor for the total amount.  We later received a refund (refunded directly to our checking account) for the shipping since that should have been N/C.  So this was a credit for COGS-Freight In. I entered the refund in the "make deposits" screen.  Now what?  How do I link that refund to that vendor? 

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Best answer December 10, 2018

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Level 15

What is my next step after entering a vendor refund in make deposits?

inbound shipping should be part of item cost

but since you are entering it separately, you can not link the deposit to the vendor, not is there a reason to.  From what you say you posted inbound shipping to the cogs account, increasing the expense, the deposit using the same cogs account as the source account for the deposit, reduces the expense.

If you entered a bill, you said you used write checks - did you link the check to the bill and is it marked as paid

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Level 15

What is my next step after entering a vendor refund in make deposits?

inbound shipping should be part of item cost

but since you are entering it separately, you can not link the deposit to the vendor, not is there a reason to.  From what you say you posted inbound shipping to the cogs account, increasing the expense, the deposit using the same cogs account as the source account for the deposit, reduces the expense.

If you entered a bill, you said you used write checks - did you link the check to the bill and is it marked as paid

View solution in original post

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Level 1

What is my next step after entering a vendor refund in make deposits?

@Rustler - Tips & Tutorials - if we place an order & use our debit card, when we receive the order I will use the "write checks" to enter the transaction (no PO or bill is entered).  Even if I use the write checks it adds the inventory.  That is correct that I enter the shipping expense as COGS-Freight In and then I used that same account when entering the deposit for the refund on shipping.  So I am finished with this then?  I do not need to do anything else?  I was confused about using the "make deposits", I was not quite sure what happened behind the scenes, and if I needed to do anything else.  Thanks!!
Level 15

What is my next step after entering a vendor refund in make deposits?

The overall cost of inbound shipping is reduced when you post that refund to the cogs account, that seems to be the point of the refund, so I see it as done.
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Level 1

What is my next step after entering a vendor refund in make deposits?

@Rustler - Tips & Tutorials  perfect, I will leave this particular transaction alone then!  I am done!  Thank you!!!
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Level 15

What is my next step after entering a vendor refund in make deposits?

You're Welcome
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Level 15

What is my next step after entering a vendor refund in make deposits?

"Tips & Tutorials - if we place an order & use our debit card, when we receive the order I will use the "write checks" to enter the transaction (no PO or bill is entered)."

That;s fine; the issue is, if you need to be able to access Items or not.

"Even if I use the write checks it adds the inventory."

Because you listed Items, and did not post to accounts. The Deposit screen only provides for Accounts. A Vendor Credit provides for Items, and then a  refund would be AP.

Or, a refund is just Make Deposit, as "from" COGS or Freight expense.

"That is correct that I enter the shipping expense as COGS-Freight In and then I used that same account when entering the deposit for the refund on shipping."

You are being told that inbound freight is supposed to be Costed into the products you got. Ask your own CPA about this. Example: You buy $5,000 equipment with $500 shipping inbound = $5,500 Basis.

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Level 1

What is my next step after entering a vendor refund in make deposits?

@qbteachmt @Rustler - Tips & Tutorials
Since taking over this position I've felt that the shipping should be included in the COGS as well, and I've asked our accountant, he actually set it up the way we do it now??  

So should it go like this....we have hundreds of items that we sell.  When I enter a bill for lets say 3 different items from one vendor, should we be dividing the total shipping into the COGS price?  We receive each item on a separate line, so if shipping was $20.00 for 3 different items and the item price is $5.00 each, the item COGS would be entered as $11.67 each?  I get confused trying to create reports to make sure we are marking up shipping enough on customer invoices. We use the expense accounts COGS-Freight in when we receive inventory that we will stock, we use Delivery & Frt-Franchise Supplies when we ship outbound UPS & R & L, and use Postage for adding to our postage machine.  We use Supplies-shipping when purchasing boxes & peanuts used for shipping.  The we use income accounts UPS & Postage when billing our customers for shipping.  How can I determine P & L on this??  

The advice I have received is as follows.....Run P & L, drilldown on COGS-Freight in, divide the total of COGS-Freight in by the total number of items sold.  That will give us the "average" COGS-Freight In for each item.  But that is not going to include the cost of outbound shipping and supplies purchased to ship.

I just do not know if that is the correct way to look at this??

Then when I look at the average cost of an item it's not accurate because the COGS-Frt in is not included.
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Level 15

What is my next step after entering a vendor refund in make deposits?

Inbound shipping for Inventory is not posted to COGS; it isn't sold, yet. If the shipping is on the same charge listing as the products, you simply allocate it into the products, the same as any sales tax you paid. You enter it into QB not the same as how it is listed on the receipt to you.

If the shipping is a different provider, you post that to Other Asset. Then, you use Adjust Inventory, and allocate the cost per item name, for inventory to be fully costed. Like this example:

I have a client that handles sporting goods. We get Shipping, pallet fees and broker fees Not from the manufacturer. That means we use "other charge" items that all post to Other Asset. Then, we list the actual products on a Bill for vendor name = WIP; we list everything that we got, as items, fully costed from the total in WIP. We click on the Expenses tab and remove that value from the WIP account using a negative. Hit Recalc= this is a $0 Bill and considered paid.

Now the products are on hand fully costed.

WIP = work in process.

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