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1. Refunds 2. Promotional Check Management dms_90069 01-02-2007
Posted by dms_90069 on January 2, 2007, 10:39 pm
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 Greetings,
I would appreciate any assistance with two QuickBooks questions. I
have QB Pro 2006 and am entering data from a small business started in
2006.

1. Refunds - The scenario/question is listed below.

Invoice for:
Amount: $1,050.00
Account: Product - Income

Receive Payment: $1050.00

Customer Refund is less a $50.00 handing fee.

Customer Refund for:
Issue Credit Memo for $1000.00
Issue Refund Check for $1000.00

The remaining $50.00 handling fee I would like to go into another Chart
of Accounts - not the Product Income, but a Product Refund account. Is
there a way to accommodate this in QB?


2. Promotional Credit Card (cc) Check
How do you process a promotional credit card check that was used to pay
another credit card bill? This may be a question for our CPA, but
I'm hoping you can give me an idea of how others have managed it.

When we first started our business we used one cc (Visa) promotional
check, which had no interest associated with it, to pay a cc (MC) bill.
I wrote the promotional check directly to MC to pay the MC bill; it
was not deposted into our checking account. Do I need to setup a
separate CofA to deposit this into initially? How is this usually
managed?

Lastly, on the cc (VISA) bill, when I enter the promotional check as a
Split, what expense account do I use? It is not a products purchased,
or any other line item I have. Do I again create a separate item just
for this promotional check?

Any help is greatly appreciated.

Thanks,
DMS


Posted by Laura on January 3, 2007, 8:03 am
Please log in for more thread options
> Greetings,
> I would appreciate any assistance with two QuickBooks questions. I
> have QB Pro 2006 and am entering data from a small business started in
> 2006.
>
> 1. Refunds - The scenario/question is listed below.
>
> Invoice for:
> Amount: $1,050.00
> Account: Product - Income
>
> Receive Payment: $1050.00
>
> Customer Refund is less a $50.00 handing fee.
>
> Customer Refund for:
> Issue Credit Memo for $1000.00
> Issue Refund Check for $1000.00
>
> The remaining $50.00 handling fee I would like to go into another Chart
> of Accounts - not the Product Income, but a Product Refund account. Is
> there a way to accommodate this in QB?

You could do this using a JE that debits Product - Income and credits
Product Refund accounts. Alternatively you could create an Item that points
to the Product Refund account. When you create the credit memo add 2 more
lines to the CM:
-1 qty - refund item @$50
+1 qty - original product item @$50

This will have the same result as a journal entry but provides you with a
better audit trail because it is included in the credit memo.

Are you aware that it is customary to record the refunds to an Contra
Revenue account typically called Returns and Allowances? I would post the
entire

>
>
> 2. Promotional Credit Card (cc) Check
> How do you process a promotional credit card check that was used to pay
> another credit card bill? This may be a question for our CPA, but
> I'm hoping you can give me an idea of how others have managed it.
>
> When we first started our business we used one cc (Visa) promotional
> check, which had no interest associated with it, to pay a cc (MC) bill.
> I wrote the promotional check directly to MC to pay the MC bill; it
> was not deposted into our checking account. Do I need to setup a
> separate CofA to deposit this into initially? How is this usually
> managed?

Yes, you need to have an account setup to receive the funds from the
promotional check.

Is this freebie money or are you expected to repay those funds received? If
there is a liability associated with it, then use the Credit card account
type for this and future charges on that credit card.

> Lastly, on the cc (VISA) bill, when I enter the promotional check as a
> Split, what expense account do I use? It is not a products purchased,
> or any other line item I have. Do I again create a separate item just
> for this promotional check?

Treat this just like any other check to pay the MC bill. The only thing that
is different is the account for the bank account. Use the expense accounts
associated with the items purchased to reflect how that money was spent.

> Any help is greatly appreciated.
>
> Thanks,
> DMS
>


Posted by L on January 3, 2007, 8:07 am
Please log in for more thread options
> Greetings,
> I would appreciate any assistance with two QuickBooks questions. I
> have QB Pro 2006 and am entering data from a small business started in
> 2006.
>
> 1. Refunds - The scenario/question is listed below.
>
> Invoice for:
> Amount: $1,050.00
> Account: Product - Income
>
> Receive Payment: $1050.00
>
> Customer Refund is less a $50.00 handing fee.
>
> Customer Refund for:
> Issue Credit Memo for $1000.00
> Issue Refund Check for $1000.00
>
> The remaining $50.00 handling fee I would like to go into another Chart
> of Accounts - not the Product Income, but a Product Refund account. Is
> there a way to accommodate this in QB?

There should be two lines on the credit memo. One item that credits the
entire amount, and another item that shows a negative amount of $50 for the
handling charge. You will have to create a list item that points to the
Product Refund account.

>
>
> 2. Promotional Credit Card (cc) Check
> How do you process a promotional credit card check that was used to pay
> another credit card bill? This may be a question for our CPA, but
> I'm hoping you can give me an idea of how others have managed it.
>
> When we first started our business we used one cc (Visa) promotional
> check, which had no interest associated with it, to pay a cc (MC) bill.
> I wrote the promotional check directly to MC to pay the MC bill; it
> was not deposted into our checking account. Do I need to setup a
> separate CofA to deposit this into initially? How is this usually
> managed?
>
> Lastly, on the cc (VISA) bill, when I enter the promotional check as a
> Split, what expense account do I use? It is not a products purchased,
> or any other line item I have. Do I again create a separate item just
> for this promotional check?
>
>
I'm not an accountant, so check with yours. That said, isn't the
'promotional check' another name for a balance transfer? When entering the
check as an expense into the Visa register, wouldn't the category be the MC
account?



Posted by scfundogs on January 3, 2007, 9:55 am
Please log in for more thread options
dms_90069@yahoo.com wrote:
>
> 2. Promotional Credit Card (cc) Check
> How do you process a promotional credit card check that was used to pay
> another credit card bill? This may be a question for our CPA, but
> I'm hoping you can give me an idea of how others have managed it.

You treat it as a credit card account. You essentially used a Visa cc
(regardless of the fact that it was a paper check) to pay a MC cc.
Setup the Visa as a CC account in QB then record the payment from the
Visa to the MC.

> Lastly, on the cc (VISA) bill, when I enter the promotional check as a
> Split, what expense account do I use? It is not a products purchased,
> or any other line item I have. Do I again create a separate item just
> for this promotional check?

If you setup the Visa as a cc in QB then the check, possibly recorded in
QB as a transfer, is already there, just reconcile it.

--
Tara

Posted by dms_90069 on January 3, 2007, 11:49 am
Please log in for more thread options
Greetings,
Thank you for all your helpful answers. I appreciate your assistance.

Cheers,
DMS

dms_90069@yahoo.com wrote:
> Greetings,
> I would appreciate any assistance with two QuickBooks questions. I
> have QB Pro 2006 and am entering data from a small business started in
> 2006.
>
> 1. Refunds - The scenario/question is listed below.
>
> Invoice for:
> Amount: $1,050.00
> Account: Product - Income
>
> Receive Payment: $1050.00
>
> Customer Refund is less a $50.00 handing fee.
>
> Customer Refund for:
> Issue Credit Memo for $1000.00
> Issue Refund Check for $1000.00
>
> The remaining $50.00 handling fee I would like to go into another Chart
> of Accounts - not the Product Income, but a Product Refund account. Is
> there a way to accommodate this in QB?
>
>
> 2. Promotional Credit Card (cc) Check
> How do you process a promotional credit card check that was used to pay
> another credit card bill? This may be a question for our CPA, but
> I'm hoping you can give me an idea of how others have managed it.
>
> When we first started our business we used one cc (Visa) promotional
> check, which had no interest associated with it, to pay a cc (MC) bill.
> I wrote the promotional check directly to MC to pay the MC bill; it
> was not deposted into our checking account. Do I need to setup a
> separate CofA to deposit this into initially? How is this usually
> managed?
>
> Lastly, on the cc (VISA) bill, when I enter the promotional check as a
> Split, what expense account do I use? It is not a products purchased,
> or any other line item I have. Do I again create a separate item just
> for this promotional check?
>
> Any help is greatly appreciated.
>
> Thanks,
> DMS


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