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doin-that-secwork
February 8, 2023
Question

Applying Credit Memo from Vendor

  • February 8, 2023
  • 1 reply
  • 0 views

I'm fairly new to the terminology used in this section of business so pardon any mistakes.

I've entered quite a few invoices as "Write Check" for the business I'm contracted at - all of these were payments made to vendors for parts and goods. I now have to parse thru this stack of returned parts and goods from the same vendor.

So my question is... how do I apply these credits from the vendor to my account?

In simplest terms I can think of without messing things up because of my lack of knowledge...
1.) We buy parts from a store and pay for it.
2.) I take the invoice and enter it into our Quickbooks
3.) Turns out its the wrong part! So we return it and get a new invoice with the credited amount.
4.) ??? (How do I enter this information correctly?)

Thank you in advance for the help!

1 reply

R
Rea_M
February 8, 2023

Hello there, @doin-that-secwork.

 

I'll make sure you can enter your vendor transactions correctly to keep your expense data accurate in QuickBooks Desktop (QBDT).

 

Since you've already written checks for your expenses, you'll have to record a deposit for the vendor check you've received from the returned item(s). Then, record a bill credit for the refund or credited amount and link it to the deposit. This way, you can appropriately enter all your vendor transactions. For the step-by-step guide, please refer to the steps below.

 

To record a deposit of the vendor check, here's how:

 

  1. Go to the Banking menu, then select Make Deposits.
  2. If the Payments to Deposit window appears, select OK.
  3. In the Make Deposits window, select the Received from drop-down and choose the vendor who sent you the refund.
  4. In the From Account drop-down, select the appropriate Accounts Payable account.
  5. In the Amount column, enter the actual amount of the Vendor check.
  6. Enter the remaining information in the Deposit.
  7. Select Save & Close.

 

To record a Bill Credit for the returned items, here's how:

 

  1. Go to the Vendors menu, then select Enter Bills.
  2. Select the Credit radio button to account for the return of goods.
  3. Enter the Vendor name.
  4. Select the Items Tab.
  5. Enter the returned items with the same amounts as the refund check.
  6. Select Save & Close.

 

To link the deposit to the Bill Credit, here's how:

 

  1. Go to the Vendors menu, then select Pay Bills.
  2. Check the Deposit that matches the Vendor check amount.
  3. Select Set Credits and apply the Bill Credit you created earlier then select Done.
  4. Select Pay Selected Bills, then select Done.

 

You can check out this article to further guide you in recording refunds you received from a vendor in QBDT: Record a vendor refund in QuickBooks Desktop.

 

Also, there are two Accounts Payable (A/P) workflows you can use to track your outstanding bills in QBDT. If you wish to learn which process best suits your business, you can check out this article: Accounts Payable workflows in QuickBooks Desktop.

 

Please don't hesitate to let me know in the comments if you have other concerns about recording vendor refunds and expense transactions in QBDT. I'm always around to help. Take care, and I wish you continued success, @doin-that-secwork.

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