Correcting an error to do with a journal entry

@Sweeta50 

Just to confirm, are you trying to remove $125 from your bank account and create a $125 receivable?  If so, you just have the debit and credit backwards on your journal entry.  It should be a debit to your customer's A/R account and a credit to your bank account.  

Thank you for reaching out to the Community, @Sweeta50. It seems that you're trying to handle customer returned payments through Journal entry in QBO. If so, you can follow Rainflurry's advise to correct it. Moving forward if you encounter the same situation, I'd like to add alternative solutions.

If your bank account is connected to QBO, the standard method is to recategorize the returned payment amount to A/R which acts as an expense and you can link the payment to it. Here's how:

1. Go to Transactions, then select Bank transactions.
2. Identify the bounced check or returned payment in the bank feed and expand the transaction details.
3. In the Vendor/Customer dropdown, choose the customer whose payment bounced.
4. In the Account dropdown, use Accounts Receivable.
5. When you're done, click Add.

If your bank isn't connected to QBO, you can make an expense for this transaction and then match it to your bank at a later time.

1. Navigate to Sales, and choose Customers.
2. Locate the customer with the bounced payment.
3. Find the payment for the returned check and Edit it.
4. Select the payment made link.
5. Uncheck the box for the invoice that initially received the payment.
6. Pick the new expense you created in Step 1.
7. Save and close.
8. When prompted about the transaction's link, confirm by selecting Yes.

In the future, if you face issues with customers or vendors who have open balances, please consult the guide: Manage outstanding balances for customers and vendors in QuickBooks Online. This resource offers comprehensive instructions and troubleshooting tips.

In addition to these steps, I encouraged you to explore QuickBooks Live Expert Assisted. Given the complexities involved in financial management and error correction, having the guidance of experts, enhances the accuracy of your financial records and offers reassurance that you are following the best accounting practices.

I appreciate your dedication to maintaining the financial records accurately, and remember, you’re not alone in this. My team and I are always here, ready to provide you with expert advice and share valuable insights whenever you need a helping hand. I'm looking forward to assisting you again. Until then, have a wonderful day ahead!