Record a Refund From a Vendor In Quickbooks

dollar-bill-01-300x225Vendor refunds are found to happen at some point in time. Let’s say you paid for a product or service but the vendor failed to deliver. In most cases such as this, they will simply refund your money. Assuming you are vigilant with your accounting, however, you probably have the amount paid already recorded in Quickbooks.

This new refund creates a troubling scenario for beginners, especially if you’ve never handled them before. But the truth is that recording a refund from a vendor is a quick and easy process that should only take a couple minutes tops.

Steps To Recording a Vendor Refund

  1. Access the banking portal in your Quickbooks account.
  2. Click on the menu labeled ‘Make Deposits’
  3. Click the ‘Deposit To’ drop-down menu and select the appropriate the client.
  4. Select the ‘Received From’ option by clicking the blank line.
  5. In the ‘From Account column,’ choose the expense used on the original bill.
  6. *Important* In the column labeled ‘Amount,’ enter the total amount of the refund.
  7. When you are finished, click ‘Save & Close’ to complete the refund recording by saving it to your Quickbooks account.

What About Refunds That Are More Than Credit Owed

Here’s a scenario to consider: a vendor wants to show their good faith by refunding you more than the original credit that was owed to you. Some vendors do this to keep their clients happy and encourage them to come back for future purchases. Assuming you followed the steps mentioned above, however, you may run into some hurdles trying to record a refund that’s more than the credit owed. This doesn’t necessary mean it’s impossible, but it will stake a couple extra steps to complete.

When recording vendor refunds that are more than the original credit owed, enter the difference on the second line of the deposit using the respective vendor’s information. For instance, if the original credit owed was $750 and the vendor refunded you $1,000, you would enter $250 on the second line along with the vendor’s name, accounts payable and original refund amount. This allows Quickbooks to account for both the original refund plus the additional credit owed.

Hopefully, this will give you a better understanding on how to record vendor refunds in Quickbooks. Whether you use Quickbooks Online, Premier, Plus or any other version, you can follow the steps outlined here to record vendor refunds.

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