Thanks again. My client's business has been good, so no negative deposits in a long time. I'm glad I bookmarked this to watch later. This video is a real time saver.
I'm Back! This video is a real time saver for me. If I have to come back only once per year, I'll be happy. Quickbooks can be a real time saver. Quickbooks can also be a time killer!
Hey thanks Shanqua! Best thing to do is subscribe to my channel here and click on the bell icon to make sure you're notified of new videos when they come out. I'm sure I'll have plenty of new videos coming out as time goes on!
We have found that if a credit card refund was made through the integrated Intuit Payments that the Refund Receipt does not have the "Refund From" field present; it's hard-coded to go to Undeposited Funds. In either case, the method that we use does not require is simpler and does not require the use of a clearing account. Simply use a line on the "Add Funds to this deposit" and select the checking account in the "Account" field and enter the amount on that line that makes the total Deposit amount zero. A withdrawal will show from the checking account.
That's the problem. A withdrawal will show up from the checking account and by zeroing out the negative deposit (net refund) you will have nothing to reconcile with that withdrawal. We've found that in most cases, bookkeepers will think these are fees and book these to credit card processing fees.
@@nerdenterprises That's exactly what we want is a withdrawal from the bank account. Intuit Payments has deducted the amount out of the bank account for the refund given to the customer. The method described above creates that withdrawal. This is a simpler method (no need for a helper account) that solves for the problem correctly and simply.
@@jeffcecchini3588 I see what you are saying. I don't love it from an Audit trail standpoint. it creates an extra entry in the check register, which of course is $0.00 so it's fine in terms of reconciliation, but to me (and this is just my opinion based on how I do things) it's not "bulletproof. With the clearing account it makes it crystal clear what's going on from an Audit standpoint. But the most important thing at the end of the day is that your method works for you, and more importantly, the balance sheet and P&L are accurate - and the numbers can be proven easily and with confidence.
I am currently showing a negative balance in my undeposited funds. I created the original sales receipt and coded it to undeposited funds which caused the negative balance. But then I created an entire new sales receipt and corrected the coding to checking. I match my bank feed, but my undeposited funds is still showing a negative balance. Any thoughts on how to correct this?
When you create a sales receipt and assign "Undeposited Funds" in the Deposit To, that won't create a negative balance. It increases undeposited funds. Is it possible you're using an item on the sales receipt that is mapped to Undeposted Funds? That would create a negative balance there. I'd have to see this to be able to help you properly. Something tells me there's something else going on that is causing the issue.
@@Maryam7580 Hi! The best thing to do would be to sign up for a 1:1 session: new.nerdenterprises.com/QuickBooks-Online-Bookkeeping-Staff-Accounting-Support
Been using this method for years and it worked great! But all of a sudden QB will not let me do a bank deposit with the clearing acct any more. I click on the dropdown and its not on the list. Its still listed as other current assets but it wont let me use it anymore. Anyone else have this issue?
Yeah I just tried it and it looks like you can no longer deposit to accounts other than bank accounts. So I would create a bank account called, "Clearing Accounts" and then change your clearing account types to "Bank" and make them sub-accounts of "Clearing Accounts." This will keep them separate on the Balance Sheet and solve the problem!
@@nerdenterprises Ok i had another one of these today. Just for the hell of it i decided to just try and do a neg bank acct deposit... and it worked. LOL so at some point QB updated and gave us functionality to record neg bank deposits. Im still really glad you taught me this though since knowing how to record into clearing acct is helpful. Thanks again!
I'm using QBO for my amazon fba business. At the start I was paying amazon the monthly subscription but not making anything so it was costing me. I know for money I get paid from them it goes through Customer > Amazon. As I had to pay amazon at the start should I record through Expense > Amazon ?
Hey there. For Fees I use an Amazon vendor, not customer. The idea is to keep sales related activity associated with a customer, and expense / Cost of Goods Sold (COGS) related activity associated with the vendor.
I loved your video, very detailed and step by step. Do you have a video about how to classify a transaction for this situation? I bough a TV for my customer and he deposited the money on my account. How I classify the deposit he made and the purchase that I made? Thank you!!
Hello, and thank you! I am glad this helped! Just so I am clear, you bought a TV for your customer, and he reimbursed you? If I am reading this correctly, you can post the purchase to an asset account (like a receivable) and then post his deposit against that same account. It should zero out.
Hi Seth I have found your videos very useful however I am ha ing some difficulties on this. I have 4 transactions that are deposited as one negative amount in to my bank feed. but I can't match it up. I have 3 refunds to one customer and one deposit from another the total being negative. on the bank feed I am trying to match up but doesn't allow negative. I have tried your way here to change the refunds to a clearing account. but when I go to each transaction it does not show me a place change undeposited to clearing. as this was done through quckbooks credit card payments. please can you help
For QB Payments, you can't change it from undeposited funds, but you should be able to deposit each of them (or all at once) from undeposited funds to the clearing account. Just change the account up top. Then you can add in the amounts from the bank feed against the clearing account.
I’m new to Qb and I’m attempting to reconcile our company account. We received a check that is suppose you be divided between a bunch of customers but there are a couple charge backs on it... would I use this same method to fix the check ?
Hi Beka. What you are describing is a little different. If your customer paid you less than the full amount, watch this video 👉 Quickbooks Online Tutorial - What Happens When The Customer Pays Less? ua-cam.com/video/jiuicdt9QxE/v-deo.html
i dont think this is right. it leaves a payment in the customer file with no resolution. Only resolution i could come up with is a new invoice to match the new payment, which would increase taxable income
When you're at this point, you're past the customer payment. If you get a chargeback for example, the bank takes that money away. In that case you don't leave a payment on the customer's account. If anything, by booking that chargeback to the customers A/R you are adding a charge to it. And that's exactly what you want, because the money was taken away from you, so now the customer owes you the money again. Plus some fees.
It doesn't matter much, but if you're setting this up as an Other Current Asset, then you can use the same thing for the detail type; Other Current Assets. You can also set these up as Bank Accounts in which case you would use Cash on Hand as the detail type.
What if you are dealing with a holding account and depending on income and expenses, the amount at the end of the month may either be negative or positive fluctuating the holding account?
If it's positive then you don't need a holding or clearing account, because in those cases you would simply record a deposit. However if your particular use case is such that you won't know which way it goes, then if it ends up being positive you record a deposit into the bank account and take it from the clearing account.
These "negative deposits" drive me crazy. Was it helpful this time, yes! Will I remember how to do this next time, no. I'll take some notes. Thank you!
LOL. Or bookmark this video and watch it again when you need it. People tell me they have my payroll videos bookmarked and they play them every time they have to book payroll :)
Well, I'm back! And it worked the second time as well. Thanks again. I hope my additional notes make it so next time I visit this video, it will be for fun. Back to listening to Billy Joel!
@@John_GGG Awesome! By the way I launched a complete course and resource last month called Bulletproof Bookkeeping with QuickBooks Online --> new.nerdenterprises.com/store use coupon code BB25 for 25% off!
Hey Seth, watched a bunch of your videos over the years. Thanks for everything. And yes you are world famous. The question is the same, as your title, except in Quickbooks Desktop (Pro 2013). I run a Shopify e-commerce store and enter the payouts into QBD. However, I have a negative Payout from a Chargeback and QBD (Sales Receipt) gives me an error message when I try to save, that says "You cannot record a negative sales receipt. Use the Create Credit Memo/Refunds window." Please help. Thank you!
Hi Chris! Thank you so much. The easiest thing to do is create an item mapped to a clearing account, and use it to zero out the sales receipt. Then record the payment from your bank account (that would have resulted from the chargeback) against the same clearing account. Now everything should balance and reconcile perfectly. Let me know if you need any further clarification on anything.
Thanks again.
My client's business has been good, so no negative deposits in a long time. I'm glad I bookmarked this to watch later. This video is a real time saver.
I'm Back!
This video is a real time saver for me. If I have to come back only once per year, I'll be happy.
Quickbooks can be a real time saver.
Quickbooks can also be a time killer!
I refer back to this often, thanks. Any new QBO videos coming out soon?
Hey thanks Shanqua!
Best thing to do is subscribe to my channel here and click on the bell icon to make sure you're notified of new videos when they come out.
I'm sure I'll have plenty of new videos coming out as time goes on!
We have found that if a credit card refund was made through the integrated Intuit Payments that the Refund Receipt does not have the "Refund From" field present; it's hard-coded to go to Undeposited Funds. In either case, the method that we use does not require is simpler and does not require the use of a clearing account. Simply use a line on the "Add Funds to this deposit" and select the checking account in the "Account" field and enter the amount on that line that makes the total Deposit amount zero. A withdrawal will show from the checking account.
That's the problem. A withdrawal will show up from the checking account and by zeroing out the negative deposit (net refund) you will have nothing to reconcile with that withdrawal. We've found that in most cases, bookkeepers will think these are fees and book these to credit card processing fees.
SO much easier! ty!
@@nerdenterprises That's exactly what we want is a withdrawal from the bank account. Intuit Payments has deducted the amount out of the bank account for the refund given to the customer. The method described above creates that withdrawal. This is a simpler method (no need for a helper account) that solves for the problem correctly and simply.
@@jeffcecchini3588 I see what you are saying. I don't love it from an Audit trail standpoint. it creates an extra entry in the check register, which of course is $0.00 so it's fine in terms of reconciliation, but to me (and this is just my opinion based on how I do things) it's not "bulletproof. With the clearing account it makes it crystal clear what's going on from an Audit standpoint.
But the most important thing at the end of the day is that your method works for you, and more importantly, the balance sheet and P&L are accurate - and the numbers can be proven easily and with confidence.
@@nerdenterprises I like it because it's all neatly & tightly contained within one transaction.
This is exactly what I needed. We have a shopify store that we got into this situation and this solution worked great. Thanks so much!
Thank you Justin! I am so glad this helped!
I am currently showing a negative balance in my undeposited funds. I created the original sales receipt and coded it to undeposited funds which caused the negative balance. But then I created an entire new sales receipt and corrected the coding to checking. I match my bank feed, but my undeposited funds is still showing a negative balance. Any thoughts on how to correct this?
When you create a sales receipt and assign "Undeposited Funds" in the Deposit To, that won't create a negative balance. It increases undeposited funds.
Is it possible you're using an item on the sales receipt that is mapped to Undeposted Funds? That would create a negative balance there.
I'd have to see this to be able to help you properly. Something tells me there's something else going on that is causing the issue.
@@nerdenterprises Thank you so much for your response. Can I contact privately to share more information about the issue?
@@Maryam7580 Hi! The best thing to do would be to sign up for a 1:1 session:
new.nerdenterprises.com/QuickBooks-Online-Bookkeeping-Staff-Accounting-Support
Been using this method for years and it worked great! But all of a sudden QB will not let me do a bank deposit with the clearing acct any more. I click on the dropdown and its not on the list. Its still listed as other current assets but it wont let me use it anymore. Anyone else have this issue?
Yeah I just tried it and it looks like you can no longer deposit to accounts other than bank accounts.
So I would create a bank account called, "Clearing Accounts" and then change your clearing account types to "Bank" and make them sub-accounts of "Clearing Accounts." This will keep them separate on the Balance Sheet and solve the problem!
@@nerdenterprises My Man! Worked perfectly. I wouldnt have thought to make the sub acct. Thanks for responding so quick.
@@jamierusso6154 🙏🙏🙏 Thank Gd!
@@nerdenterprises Ok i had another one of these today. Just for the hell of it i decided to just try and do a neg bank acct deposit... and it worked. LOL so at some point QB updated and gave us functionality to record neg bank deposits. Im still really glad you taught me this though since knowing how to record into clearing acct is helpful. Thanks again!
I'm using QBO for my amazon fba business. At the start I was paying amazon the monthly subscription but not making anything so it was costing me. I know for money I get paid from them it goes through Customer > Amazon. As I had to pay amazon at the start should I record through Expense > Amazon ?
Hey there. For Fees I use an Amazon vendor, not customer. The idea is to keep sales related activity associated with a customer, and expense / Cost of Goods Sold (COGS) related activity associated with the vendor.
I loved your video, very detailed and step by step. Do you have a video about how to classify a transaction for this situation? I bough a TV for my customer and he deposited the money on my account. How I classify the deposit he made and the purchase that I made? Thank you!!
Hello, and thank you! I am glad this helped!
Just so I am clear, you bought a TV for your customer, and he reimbursed you?
If I am reading this correctly, you can post the purchase to an asset account (like a receivable) and then post his deposit against that same account. It should zero out.
Hi Seth I have found your videos very useful however I am ha ing some difficulties on this. I have 4 transactions that are deposited as one negative amount in to my bank feed. but I can't match it up. I have 3 refunds to one customer and one deposit from another the total being negative. on the bank feed I am trying to match up but doesn't allow negative. I have tried your way here to change the refunds to a clearing account. but when I go to each transaction it does not show me a place change undeposited to clearing. as this was done through quckbooks credit card payments. please can you help
For QB Payments, you can't change it from undeposited funds, but you should be able to deposit each of them (or all at once) from undeposited funds to the clearing account. Just change the account up top. Then you can add in the amounts from the bank feed against the clearing account.
I’m new to Qb and I’m attempting to reconcile our company account. We received a check that is suppose you be divided between a bunch of customers but there are a couple charge backs on it... would I use this same method to fix the check ?
Hi Beka. What you are describing is a little different. If your customer paid you less than the full amount, watch this video 👉 Quickbooks Online Tutorial - What Happens When The Customer Pays Less? ua-cam.com/video/jiuicdt9QxE/v-deo.html
i dont think this is right. it leaves a payment in the customer file with no resolution. Only resolution i could come up with is a new invoice to match the new payment, which would increase taxable income
When you're at this point, you're past the customer payment. If you get a chargeback for example, the bank takes that money away. In that case you don't leave a payment on the customer's account. If anything, by booking that chargeback to the customers A/R you are adding a charge to it. And that's exactly what you want, because the money was taken away from you, so now the customer owes you the money again. Plus some fees.
When we create a clearing account, what should we select for the "Detail Type"?
It doesn't matter much, but if you're setting this up as an Other Current Asset, then you can use the same thing for the detail type; Other Current Assets. You can also set these up as Bank Accounts in which case you would use Cash on Hand as the detail type.
What if you are dealing with a holding account and depending on income and expenses, the amount at the end of the month may either be negative or positive fluctuating the holding account?
If it's positive then you don't need a holding or clearing account, because in those cases you would simply record a deposit. However if your particular use case is such that you won't know which way it goes, then if it ends up being positive you record a deposit into the bank account and take it from the clearing account.
These "negative deposits" drive me crazy.
Was it helpful this time, yes!
Will I remember how to do this next time, no. I'll take some notes.
Thank you!
LOL. Or bookmark this video and watch it again when you need it. People tell me they have my payroll videos bookmarked and they play them every time they have to book payroll :)
Well, I'm back! And it worked the second time as well. Thanks again. I hope my additional notes make it so next time I visit this video, it will be for fun.
Back to listening to Billy Joel!
@@John_GGG Awesome! By the way I launched a complete course and resource last month called Bulletproof Bookkeeping with QuickBooks Online --> new.nerdenterprises.com/store use coupon code BB25 for 25% off!
Hey Seth, watched a bunch of your videos over the years. Thanks for everything. And yes you are world famous. The question is the same, as your title, except in Quickbooks Desktop (Pro 2013). I run a Shopify e-commerce store and enter the payouts into QBD. However, I have a negative Payout from a Chargeback and QBD (Sales Receipt) gives me an error message when I try to save, that says "You cannot record a negative sales receipt. Use the Create Credit Memo/Refunds window." Please help. Thank you!
Hi Chris! Thank you so much.
The easiest thing to do is create an item mapped to a clearing account, and use it to zero out the sales receipt.
Then record the payment from your bank account (that would have resulted from the chargeback) against the same clearing account. Now everything should balance and reconcile perfectly.
Let me know if you need any further clarification on anything.
Thank you for this great explanation!
Thank you Jeff!
Thank you very much! Your video resolved my problem!
Perfect, Thank you for commenting and letting me know!
Thank you - great solution to this issue. Much appreciated!
Thank you!
Thank you for this explanation. 🙌