A check bounce means that you don’t have sufficient funds in your bank account. Or you can say that you do not have adequate money to complete the check amount. However, when this situation occurs, usually your bank charges you some fee primarily known as the bank fee. If you don’t know how to record a bounced check in QuickBooks, then this blog will be very useful to you. This blog also dictates how to record a bounced check in QuickBooks Desktop and QuickBooks Online. If you are not sure how to perform these steps, then directly contact the Accountant. They will assist you on how to perform these steps to record the bounced check. In QuickBooks Desktop, you can record a bounced check either through the record bounced check feature or through manual procedure. In QuickBooks Online, you can record a bounced check via invoice.
How To Use A Record Bounced Check Feature?
Record Bounced Check feature is applicable in single-user mode and only put in to check payments done via the Customer Payment window. You can record a bounced check in QuickBooks with the help of a record bounced check feature. To utilize the record bounced check feature, follow these steps such as:
- First of all, click on the Customer Center from the Customers drop-down.
- From the Transactions tab, select the Received Payments option.
- Now you have to double-click on the payment you want to record.
- Under the receive payments window, select the Record Bounced Check icon.
- In the Manage Bounced Check window, enter the following information carefully.
- QuickBooks will display the Bounced Check Summary.
- After that, click on Finish.
These steps will help you to automatically record a bounced check in QuickBooks through this feature.
How To Record It Manually?
If you want to record a bounced check manually, then follow these steps like:
- Create an item and income account for tracking bounced checks and their associate’s charges for one time. If you have created then move to the next step.
- Next, create a journal entry to reverse the original payment. For creating a journal entry follow these steps such as:
- First, open the Company menu, and then select Make General Journal Entries.
- When the journal Entries window appears, debit your account receivable for the same amount of the bounced check.
- Now enter a note in the Memo column describing the transaction.
- Under the Name column, choose the name of the customer or job related to the bounced check.
- Credit the checking or bank account that received the original deposit.
- When it is over, then click on Save & Close.
- Then change the payment for the invoice to the reversing journal entry. To implement it, then follow these steps:
- Firstly, go to the Reports menu, and then click on Customers Receivables >> Customer Balance Detail.
- Double-click the original payment line for the bounced transaction.
- In the Receive Payments window, shift the checkmark from the invoice to the reversing journal entry.
- Next, save and close the window.
Other Useful Resources:
How To Record A Bounced Check In QuickBooks Online Through An Invoice?
First, you have to create two product or service items, then set up the bank account and the other to use an income account to track bank service charges. Second, create an invoice for the bounced check and fees and record the bank service charge. In order to record a bounced check through an invoice, you have to follow some steps like:
Generate 2 Service Items
- First, you have to click on the Gear icon.
- Under lists, click on Products and Services >> New.
- In the Product/Service information panel, click on the Service item.
- Type Bounced check in the Name field.
- Choose the bank account the check was returned from the Income account menu.
- Save it and then click on new to create the second item.
- Again type the Bounced Check Fee in the Name field.
- Visit the Income account drop-down, and then add an income account called Bounced Check Fees.
- Or you can also select an existing expense account that you use to track your bank charges.
- When it completes, then save and close it.
Create The Invoice
Once the service items are created, then create the invoice by following the steps given below:
- Click on the Add New option.
- Select Customers, and then click on the Invoice.
- Select the customer name and type the date the check bounced in the Invoice date field.
- In the Product/Service field, choose the created bounced check item.
- Enter the amount of the bounced check in the Amount field.
- Click on the Bounced Check Fee item in the Product/Service field.
- Mention the amount to charge the customer for the bounced check.
- Save and close it, when it is over.
Record The Bank Service Charge
- Firstly, choose Add New, then click Vendors >> Expense.
- Find your bank from the Payment Account drop-down.
- In the Payment date field, mention the date the check bounced.
- Enter the non-sufficient fund in the Reference No. field.
- Under the Category field, select the expense account that tracks charges from your bank.
- Type the amount your bank charged you for the bounced check in the amount field.
- Once it is over, then click on save and close.
Record The Payment From Your Customer
- Hit the + New button, then click on Customers >> Receive Payment.
- Choose the customer from the Customer drop-down menu.
- Enter the Payment Date and Payment method for the new payment.
- From the Deposit section, select the bank account for the payment.
- Now enter the Amount received.
- Select the invoice you created from the Outstanding Transactions list.
- And then save and close it.
In a nutshell, we can say that you can record a bounced check in QuickBooks Online And QuickBooks Desktop. By following the above steps, you can easily record it without any difficulty. The record bounced check feature is very helpful in recording the Non-Sufficient Funds.