With the help of accounts payable, the vendors send you invoices to pay for the products or services you bought from them. In QuickBooks this transaction is termed as a bill. In case you give the product back or request for credit for the services, that particular transaction in QuickBooks is termed as a Vendor Credit. Also, this should not be mixed with the accounts receivable transaction.
Dancing Numbers helps small businesses, entrepreneurs, and CPAs to do smart transferring of data to and from QuickBooks Desktop. Utilize import, export, and delete services of Dancing Numbers software.
When is Applying Vendor Credit is Required?
The transaction to register the vendor credit in the accounting software QuickBooks is needed when you give back the items to the vendor. For this kind of transaction, you need to add vendor credit to register your refunds or returns to the vendor. During a return, if the vendor sends you a particular credit document, then it clearly means that you do not owe any money to the vendor. If the vendor cannot send a credit document, then they issue or send a refund check for that particular refunded item.
Note: Whether a vendor sends you a credit document or a refund check, you need to add a vendor credit to your particular QuickBooks account. Post that, when you are needed to pay the bill of the vendor, then you need to apply it to the QuickBooks.
How to Apply Vendor Credit in QuickBooks Online?
Here are the steps to record vendor Credit in QuickBooks Online:
Step 1: In QuickBooks Online, press on the option Create. It is displayed in the forms of + sign.
Step 2: From the given drop-down option to Create button, press on the Vendor Credit.
Step 3: The screen of Vendor Credit gets displayed.
Step 4: Select the vendor who have generated the credit.
Step 5: Enter the Date for the particular credit shared by the vendor.
Step 6: Add the Amount in the particular Credit Amount Section.
Step 7: Navigate to the Accounts Detail section.
Step 8: Now press on the Amount that is applicable for the Real Bill.
Step 9: Now select the Items in the particular Item Detail section that you gave back.
Step 10: Now, you need to go down and then link an Electric Copy of the credit to the particular transaction of the Vendor Credit.
Step 11: Press on the button Save and Close, if you do not wish to add anything on that particular list. Press on Save and New if you wish to add anything on the list.
How to Enter the Deposit on the Refund Check
Step 1: Press on the Create icon that is displayed with the + sign.
Step 2: Now from the particular Create Menu option, choose the Bank Deposit option.
Step 3: The Deposit Transaction screen opens up.
Step 4: Now, navigate to the Deposit Section. Add the information given.
Step 5: Select the Vendor who generated the Check in the particular Received Column.
Step 6: Then choose the Accounts Payable Account in the particular Account Column.
Step 7: Now share the Amount of the check of the Amount column.
Step 8: Press on Save and Close button to press this particular transaction.
Step 9: Now, press on the Create button + Sign.
Step 10: Select from Expenses.
Step 11: Choose from the Vendor from whom you are supposed to get the vendor.
Step 12: In the particular Outstanding Vendor Credit, press the Add button.
Step 13: Then press the Add option in the deposit.
Step 14: Now press on Save and Close.
How to Apply Vendor Credits to a Bill in QuickBooks?
To any open or future bill apply vendor credit. Follow the steps that are mentioned below to enter bills and track your expense.
- On the left corner of your page you have to click on +new.
- Click on Pay bills from the dropdown box that is visible on the screen.
- Then you have to select the bill that you want for the vendor. You will see the credit that is available with that specific vendor in the Credit Applied field.
- As given in the Create Vendor Credit in QuickBooks you have to finish the remaining fields mentioned above.
The ideal steps and methods to apply vendor credit in QuickBooks are mentioned above. We have also stated other processes related to applying vendor credit. We make sure that by following the steps given above as per your needs, your business process will run smoothly.
Still, if you face any trouble, we advise you to talk to our team of experts. They have all the solutions related to your business problems.
Looking for a professional expert to get the right assistance for your problems? Here, we have a team of professional and experienced team members to fix your technical, functional, data transfer, installation, update, upgrade, or data migrations errors. We are here at Dancing Numbers available to assist you with all your queries. To fix these queries you can get in touch with us via a toll-free number
+1-800-596-0806 or chat with experts.
Frequently Asked Questions (Faqs)
What is a Journal Entry for a Particular Vendor Credit to Register a Vendor Credit in QuickBooks?
A journal entry is debited to a supplier account and it reduces your liability. Post that, you need to credit the purchase return account that also cuts down the expenses.
How to Record a Bill Credit for the Returned Items?
Here are the steps to record a bill credit for the returned items:
Step 1: First, you need to choose Enter Bills from the vendor’s menu.
Step 2: Press the Credit Option button in order to account for the goods returned.
Step 3: Add the Vendor Name and press on the Items Tab.
Step 4: Add the returned items with the amount that is returned on the refund check.
Step 5: Lastly, click the Save and Close.
How to Link the Deposit to the Bill Credit?
Step 1: Navigate to the Vendors menu. Press on Pay Bills.
Step 2: Authenticate the Deposit with the Vendor Check amount.
Step 3: Select Set Credits and choose the Bill Credit.
Step 4: Press done and click on Pay Selected Bills. Now press done.
How to Record the Deposit of the Vendor Check?
Step 1: First, press on Make Deposits in the particular banking menu.
Step 2: Now, go to the make deposit window and press on received from the drop-down and select the Vendor from whom the refund has been received.
Step 3: From the account drop-down, select the right accounts payable.
Step 4: Add the right amount of the vendor check in the particular account column.
Step 5: Press on Save and Close the screen.
How to Record a Bill Credit for the Refund Amount?
Here are the steps to record a bill credit for the refund amount:
Step 1: First, navigate to the Vendors menu.
Step 2: Press Enter Bills.
Step 3: Add the Vendor name.
Step 4: Press on Expenses tab.
Step 5: Add the accounts on the real bill.
Step 6: Now, navigate to the Amount Column and add the right amount for every account.
Step 7: Lastly, press on Save and then close the tab.