if you receive a refund check from a vendor it means you have already paid them for a past
service refund checks from vendors are only from transactions where we gave them money on the same
day as the day they delivered the service and this has absolutely nothing to do with bills
vendors are paying us back for when we paid them for the service what happens to our records and
QuickBooks when a vendor gives us a refund check well obviously your cash and bank is going to go
up because you just received money and of course the expense from the check that you paid them
the expense from the original service that you originally paid will decrease because if they
give you back some of the money that you paid for a previous service you paid less for that
service and therefore that expense should go down it is important to know that refund checks from
vendors do not go into undeposited funds you can only record them on the day you physically bring
them to the bank and again it has nothing to do with bills let's take a look at an example
back on March 29 in a previous video we pay UPS a hundred and fifty dollars with cheque
number 203 and that was for a delivery we paid on March 29 and received the delivery on March
29 today May 12 we received a refund check from UPS for that specific delivery that was done back
on March 29th they gave us back fifty dollars with cheque number nine one nine one and again
this does not relate to a previous UPS bill let's take a look at what the results will
be and how to record it as usual when we look at the trial balance before we record the transact
we can see that delivery expenses sixty six thousand five hundred ten delivery expense
will go down to six thousand four hundred sixty and of course cash and bank will increase by $50
going up to twenty six thousand seven hundred something something now to record a refund check
on the day that you bring it to the bank you click banking make deposit close the payments
window because you are not depositing from undeposited funds go directly to the deposit
window and make sure that you put in the date that you physically brought this refund check
to the bank which was May 12 received from you have to choose the specific vendor the
account is whatever specific expense was on the check that you wrote them the check that you're
getting a refund for of course the amount is fifty dollars and push tab so now we have the
date that we deposited the refund check from home we depart from whom we receive the check and what
expense will decrease because we're getting paid back for the expense that we previously
paid when we click Save and close we can see cash in bank is now twenty six thousand seven
hundred something and we could see that delivery expense is now six thousand four hundred sixty
even though refunds checks do not go into undeposited funds and even though you only
record them on the day you deposit them into the bank you can deposit the refund check from
a vendor with other undeposited funds in the same deposit for example back on April 5th we
paid staples three hundred with cheque number 207 for supplies that was a check that we wrote
in a previous video on May 13th we received a refund check from UPS for those specific
supplies a hundred dollars and they gave us check number nine - nine - now you can deposit them on
May 13th with another undeposited cheque and in this example we will deposit this refund check
from from Staples in the same deposit as the cheque that we are depositing from candy who
gave us a check back on January 19th and that was checked number one two three four let's watch how
to do this from the main menu click banking make deposit because this deposit will also include
this January 19th check from candy we will select it it's checked number one two three four and we
click OK as usual we put in the deposits window the date we physically went to the bank but on
May 13th we also deposited our refund check from Staples and because the refund check was for a
payment for supplies supplies is the account that gets put in the deposit the check they
gave us was number nine - nine - and the amount of that check is $100 and the payment method
of course is check so here we have the previous payment that we're bringing to the bank as well
as today's refund from Staples that means the total deposit is 2,340 undeposited funds will
decrease by the amount that's coming out of undeposited funds supplies will decrease by
the amount we got refunded for supplies and cash and bank will increase by this entire
amount click Save and close and you can see the numbers have changed just as we expected