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jeffbrown614
May 4, 2020
Question

Returned Donation Checks

  • May 4, 2020
  • 1 reply
  • 0 views

I had 3 checks from donors returned last month for NSF. They were part of batches of multiple checks that were deposited into the bank. I'm not sure how to record these as journal entries. On my bank statement it says 'Chargeback'.

1 reply

Rubielyn_J
Rubielyn_J
May 5, 2020

Thank you for posting here in the Community, @jeffbrown614.

 

Let me guide you on how to record returned donation checks in QuickBooks Desktop. 

 

To start, you can create an item, and income account for tracking bounced checks and their associate's charges.

 

Once done, create a journal entry to reverse the original payment. Here's how:

  1. Go to the Company menu, then select Make General Journal Entries.
  2. In the General Entries window, debit your account receivables for the same amount of the NSF check.
  3. Enter a note in the Memo column describing the transaction.
  4. Choose the name of the customer or job associated with the NSF check, under the Name column.
  5. Credit the checking or bank account that received the original deposit.
  6. Click Save and Close.

After, switch the payment for the invoice to the reversing journal entry.

  1. Go to the Reports menu.
  2. Select Customers Receivables, then choose Customer Balance Detail.
  3. Double-click the original payment line for the NSF transaction.
  4. In the Receive Payments window, move the checkmark from the invoice to the reversing journal entry.
  5. Select Save & Close.

 

For additional information, you can refer to this article for details: Handle Non-Sufficient Funds (NSF) or bounced check from customers.

 

In case you want to handle a check returned by your vendor due to non-sufficient funds, you can check this article: Manage a bounced check you wrote.

 

Please let me know if there's anything I can help you with QuickBooks. I'm always around whenever you need help. Have a nice day.

J
jeffbrown614Author
May 6, 2020

Thanks for this but I'm not sure I've done this correctly. The returned checks are from donors, not customers. Two are to our General Fund and one to our Building Fund. The checks were all part of a batch of multiple checks. 

You mentioned creating an item, and income account - not sure what you mean by this. I did steps 1-6 and put the name of the person in the Name column as a customer and I see the entry listed as a payment. Not sure how to proceed from there and if I've even done that correctly. Guess what is confusing me is that these persons are not customers but making donations - there are no invoices, etc. Sorry if I'm not understanding - I'm new to the job (quite unexpectantly) and not a CPA.

A
AileneA
May 6, 2020

Hi there, @jeffbrown614.

 

Thank you for reaching back to the Community. Good job in creating the Journal Entry. The reason why you don't see the receive payments its because you haven't run any invoice. So journal entry helps you record the transaction. 

 

After creating a journal entry, we need to switch the payment for the invoice to the reversing journal entry to receive the payments. You can follow my colleague steps provided above. 

 

To learn more how journal entry works, you can check out this article: A QuickBooks Refresher on Journal Entries. 

 

I suggest reaching out to your account for advice to prevent any discrepancies in your book. 

 

You can also check this article how to handle bounce check: Manage a bounced check you wrote. 

 

Please let me know if you need anything else, I'll be here to lend a hand. Have a great day!

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