Quicken & Other Budget/Accounting Software/Quickbooks Chargebacks
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?
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
We sell and support QuickBooks Enterprise