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Managing a refund in Quickbooks

My company pays a supplier a fixed amount each month by direct debit. Over a period of time the amount of the monthly payments has exceeded the cost of the services supplied and the supplier has rectified this situation by refunding the company the excess balance.

I am uncertain ho to handle this situation in Quickbooks 2004. I have used the credits facility to handle situations where the amount of a refund is shown on an invoice and only the net amount is paid but this situation seems different because the refund is a separate payment into the company bank account which needs to be reconciled.

Can anyone give me some pointers as to what I need to do?

Thanks,

Charles Berger.

Reply to
charles
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Obviously this needs to be handled as a deposit so that you can reconcile your bank account but you don't want to affect A/P. So, I would enter the offsetting account in the deposit as the expense account used on the bills that were overpaid. This will have the effect of increasing your checking account and decreasing the expense account.

Reply to
coyboy

I think you're almost there but one thing I didn't mention is that I have a separate Accounts Payable register for this supplier. The way I handle the accounting is as follows:

When the quarterly bill arrives I enter it into the supplier's A/P register. I then record each month's direct debit as a separate bill payment. For example say that monthly DDs of £50 are paid. A quarterly bill for £130.00 arrives. I enter the bill into the A/P and then record three payments of £50. Now I'm effectively £20 in credit. This contines for the next year say with bill amounts of 120, 140 and 130. So now we have:

Bill Payment 50 50 50

130 50 50 50 120 50 50 50 140 50 50 50 130

--------

520 600

After 1 year I've overpaid by £80 and the supplier dumps a payment of £80 into my bank account. How do I capture that to make everything balance up and allow me to reconcile the bank accounts?

Apologies if I didn't fully explain the problem in the OP.

Cheers,

Charles.

Reply to
Charles Berger

I assume that you simply want to reduce what you owe to this vendor in A/P with this refund received.

You are able to post directly to the A/P account on a bank deposit slip, you just add the vendor name in the "received from" field. Then the next time that you go to pay that vendor, you will see a credit balance available that should be applied to the open bills.

Reply to
Qbadvisor

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