Bank Deposit- not sure what to do...

Thank for you contacting us, carohope.

Yes, you're right about moving the money from the Undeposited Funds account to the bank once you deposit the funds to the real-bank account.

The Undeposited Funds account keeps a record of payments in QuickBooks until you physically deposit the same payments at your real-life bank. 

If your bank account is connected to online banking, the payment is downloaded. All you need to do is match it to the deposit you've entered in QuickBooks. Doing this will link them together so you don't get duplicates.

There are several ways to record payments. You use also the Sales receipt or Invoice functions. After recording the payment, you can match it to the deposit downloaded on the Banking page. 

To ensure the statement from your real-bank account matches what's in QuickBooks, you can reconcile every month. I'm adding this article for the steps and a quick video tutorial: Reconcile an account in QuickBooks Online.

Get back to me if you need more information about making a bank deposit. Just leave a comment below and I'll get back to you.

Hi MaryLandT, 

Thanks for responding, yes I have some more questions...

When I create a bank deposit, does it automatically go in an undeposited fund? I didn't put it in undeposited funds, there were other options, so I put it somewhere else.

We are not connected to online banking and don't want to. What would be the way to do it? Do a sales receipt? But then how does it get linked together? Do I need to do that manually?

Glad to have you back, @carohope.

Joining the thread to share additional insights about processing bank deposits in QuickBooks Online.

When you create a bank deposit, this doesn't go to the Undeposited Funds (U/F) Account. The U/F account is a holding account for income or funds before the amount gets deposited to the bank.

A bank deposit is used to move the withheld funds in the U/F account to the bank. Another use of this entry is to increase the bank balance of the account indicated on the transaction.

When you create a sales receipt or invoice and choose the Undeposited Funds account to temporarily hold the amounts, that's the only time you are required to create a bank deposit. However, you can skip this process by assigning the actual bank account to the sales transactions.

For more information about using bank deposits and what to do to if in case you have U/F funds, see the following links:

• What’s the Undeposited Funds account?
• Deposit payments into the Undeposited Funds account

Please come back here if you have more questions on how to use bank deposits in QBO. I'm always here to help you. Have a good one.

Thanks for responding. I am starting to understand undeposited funds and it seems like I did not need to do it this way. 

But since I have done it, how do I fix the mistake? 

My question is: the bank deposit that I recreated, was NOT under undeposited funds. Do I still need to move the bank deposit to a sales receipt? The books have been reconciled, so do I need to do a journal entry instead- if yes how do I do that?

Thanks for getting back to this thread, @carohope.

Let me join in this conversation and provide you with further help on how to handle your transactions. 

Undeposited Funds (UF) is simply a holding account that tracks payments received from customers that haven't been deposited to your bank account.

If you already deposited your transactions to the right accounts, then you don't need to transfer them to the UF account or to a sales receipt. 

Since you've already reconciled your bank, then you don't have to create a journal entry. In case you reconcile a transaction by mistake, simply undo or remove it from your register. 

For additional resources in handling your account, you can check out these articles: 

• What’s the Undeposited Funds account?
• Reconcile an account in QuickBooks Online
• Learn the reconcile workflow in QuickBooks

Don’t hesitate to click the Reply button if you have other QuickBooks questions or concerns. I’m always ready to lend a helping hand. Enjoy the rest of the day!