Quicken & Other Budget/Accounting Software/Quickbooks Chargebacks

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Question
What is the best way to record a Chargeback in Quickbooks?  I created an invoice 2 months ago and processed a credit card payment against it.  Last week the payment got charged back to us.  I want to record the money coming out of our account and also record the invoice as going into bad debt expense.  What is the best approach?

Answer
Hi Jennifer

Sorry for the delay, I missed this notification in my email.

The simple method would be to enter the transaction on a check

1. Open write check
2. Leave check number blank
3. Enter date and amount of chargeback
4. Enter the customer name as the payee
5. Post to the account bad debt
6. Enter on the memo lines what happened

While the above  will accomplish correct accounting, it does not give a complete
"story" in the customer center.
If you would like to see this chargeback in the customer center  it is a 2 step process.
1. You would still write a check and post the check to the
    Account "accounts receivable" (not bad debts) You will need to add
   the customer name in the  customer:job field again
2. Now you would write off the chargeback that step 1 created
  Open a credit memo,  use a bad debt item , if you do not have one, type it in and
  do a quick add, use the item type of "other charge" and point the item to bad debt expense
  (if you do not have this account, type the name and QB will prompt you to add the account.
  once you save the credit memo, QB will ask if you want to apply the credit memo. Say yes,
  and apply the memo to the check tranaction that appears in the pop up window.

Hope this helps,

Linda Saltz, CPA
Advanced Certified QuickBooks Advisor
http://www.qbalance.com
We sell and support QuickBooks Enterprise  

Quicken & Other Budget/Accounting Software

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Linda Saltz, CPA, QBalance.com

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QuickBooks best practices, troubleshooting, accounting, tax We have over 70 pages of website content about QuickBooks tips, running a business, tax and business startup at http://www.qbalance.com

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Accountant and CPA over 20 years. Specializing in accounting software for over 12 years, Certified QuickBooks Pro Advisor, QuickBooks seminar instructor since 1997.
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