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tehseenliaqat-gm
October 22, 2020
Question

We want to make a reconciliation for undeposited fund to be classified, that what are the cash transactions and what are the credit card transactions?

  • October 22, 2020
  • 2 replies
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2 replies

MichelleBh
MichelleBh
October 22, 2020

Cash and credit card are examples of a payment method in QuickBooks Online (QBO), @tehseenliaqat-gm.

 

I'm here to provide some information about reconciling Undeposited Funds in QBO. 

 

We're unable to reconcile the whole Undeposited Funds (UF) account since it functions differently from other accounts we see on the reconciliation page. Undeposited Funds is an internal other current asset account created by QuickBooks Online to hold funds until you are ready to deposit them. It serves as the default Deposit To account when you receive payments, uses a payment item on an invoice, or enter a sales receipt.

 

To reconcile the transactions that are in the UF account, you'll need to deposit these payments to their appropriate bank accounts. The purpose of creating a Bank Deposit is to offset or to make the UF account balance as zero. From there, you can reconcile the transactions. 

 

Here's how: 

 

  1. Go to the New icon on the top. 
  2. Select Bank Deposit under Other. 
  3. From the Account drop-down▼menu, choose the account you want to deposit the money into.
  4. In the Select, the payments included in this deposit field put a check to on those transactions. 
  5. Hit Save and close. 

 

For the detailed guide, check out this article: Record and make bank deposits in QuickBooks Online. 

 

You can always access the Reconciliation report to check and manage the transactions. Just go to the Reports tab, then type Reconciliation in the search field, and customize the Account and Report period to show the specific information you want to see. 

 

 

Once done, you can start reconciling your account. 

 

Browse through these articles about how to fix issues while reconciling in QBO: 

 

 

Let me know if you have follow-up questions. I'm always here to help. Have a great day!

 

M
mmdcrocks
February 7, 2021

Please Help... The refund receipt is done properly, the bank is reconciled, the undeposited funds account is left with a credit balance. So the customer overpaid, the deposit came in, bank reconciled. The receipt refund was done, the money came out, bank reconciled. I am now reconciling my undeposited funds account and the refund left a credit balance. UGH!

M
mv32
February 7, 2021

Let's sort out the credit balance, @mmdcrocks.

 

When an overpayment sets a credit balance, you'll need to add a cheque and categorize it for Accounts Receivable. This way, you can link this to the payment received and zero the credit balance.

 

Here's how:

  1. Go to + New and then select Expense, Add expense, or Cheque.
  2. Select the customer you want to refund from the Payee ▼ drop-down.
  3. From the Payment account ▼ drop-down, select the bank account where you deposited the overpayment too.
  4. On the first line of the Category column, select Accounts Receivable.
  5. Enter how much you want to refund in the Amount field.
  6. Fill out the other fields as you see fit, then select Save and close.

 

Once done, you can then link the refund to the customer's credit or overpayment by receiving the payment. I've added the steps below:

  1. Go to +New and then choose Receive payment.
  2. Select the same customer you used for the cheque or expense, then fill out the needed fields.
  3. Under the Outstanding Transaction section, select the checkbox for the Expense or Check you created.
  4. Make sure the payment is equal to the credit balance, then choose Save and close.

 

You can check this reference for more insights on how to handle this in QuickBooks Online: Record a customer refund in QuickBooks Online.

 

I've added this extra article for future reference, in case you will receive and record transactions like recording overpayment as a tip: Handle a customer credit or overpayment in QuickBooks Online.

 

Please let me know if there's anything else I can help you with QuickBooks. I'll be sure to get back to you. Have a great day!

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