I currently use Paypal to accept payments for a golf tournament. I found a posting in this group that told me to set up a mirror bank account called "Paypal Checking", and then when I receive a Paypal payment on an invoice, and want to deposit those funds from A/R into my Paypal checking, that I enter a line item Expense called "Paypal Fee" and enter a negative number that corresponds to the Paypal fee. That seems to be working great!
Now, I have a situation where I need to issue a Credit Memo and a Refund via Paypal for an Invoice I received. Specifically, I have an Invoice for $895.00 I deposited to my Paypal checking account $868.74 (which is less the $26.26 Paypal fee that I entered as an Expense>Paypal Fee). I want to refund the customer $868.74, since it has been more than 60 days since the transaction date, and paypal won't let me refund entire $895.00. But when I create the Credit Memo and enter the item I wish to refund, it defaults to the full $895.00, and I can't seem to modify it to the $868.74.
What is the best way to proceed?