How to Record a Bad Check Transaction in QuickBooks?

How To Record Bounced Check in QuickBooks

How to Record a Bad Check Transaction in QuickBooks?

Bounced check means there aren't sufficient fund category checks that are returned back thanks to lack of required fund amount. These bounced checks are often a true annoyance to stay track of on your books. Bank will debit the charge for a bounced check and you've got to contact customer care to speak that their check has bounced and you've got to request another sort of payment. So, here are the straightforward steps on the way to record bounced sign up QuickBooks.

How to Record Bounced Check in for QuickBooks?

In order to record the bounced checks transaction users have two options counting on the mode of QuickBooks used. Option first Detail below is suitable for users employing Quickbooks in single-user mode, while option second is for multi-user mode of QuickBooks users.

QuickBooks in Single User Mode

If the software is employed in single-user mode then the user can take the support of the Record Bounced check tool to record these checks and Nonsufficient funds transactions. Although, before following the steps, there are some points to stay in mind as detailed:

    • The feature of Record Bounced Checks in QuickBooks can only be utilized in case of check payments.
    • If returning an ACH item, first turn the payment category to see the payment then attend the steps of this method.
    • Generally, if the icon for Record Bounced check is colored Grey or if the payment type tab remains grey due to which the user isn't complete the steps, then the user should follow these steps detailed under method 2.

Here are some steps to follow so as to record bounced checks are:-

      • Attend the most window of QuickBooks, locate the Customer’s menu then click on the customer center option.
      • Handling and choose the tab called transactions than on received Payments.
      • Select and double click on Non-sufficient fund payment transactions.
      • Under the window receive payment Screen from the most menu tab select the choice called record bounced check. it's sure that the check or transaction selected shouldn't be within the process of being cleared from the undeposited funds account because it is to urge clearance from the bank.
      • Under the screen of management Bounced Check, give the subsequent details then click on Next:
      • The software will show a bounced check summary under the small print of what went on till now's shown.
      • Differing types of common scenarios which will be encountered as follows:-
        • Invoices are marked unpaid.
        • Invoices are created with specific charges against the customer.
        • Some charges are going to be taken from the checking account.
      • Click on the Finish tab.
      • The indicator of the Bounced check is going to be shown under customers payment informing the user that they need employing the bounced check feature for the required payment
      • Lastly, a Journal Entry for this transaction is generated with assets being debited and checking account being credited
      • The invoice is then mentioned as Unpaid in order that the user can send the invoice to the customer again.

QuickBooks under Multi-user Mode

Here, the user is employing QuickBooks in Multi-user mode and thus has got to manually record the bounced check or Non-sufficient funds. Follow the steps for the same:

  • Create an account alongside items under tracking of NSF checks.
  • Now keep a record of Non-sufficient funds from the bank.
  • The next step is to reverse the transaction of the first payment.
  • Lastly, again an optional step, users can charge their customers for the NSF fees charged by the bank.

Significance of Recording Bounced Check in for QuickBooks

It is important to record a bounced checks in QuickBooks because it'll not only affect your checking account but also the balance of your assets. To resolve your checking account, you want to record the bounced check and any additional fees that the bank charges. Also, return the customer’s payment to extend your account balance.

When bouncing the customer checks, the following effect is shown:-

  • Bank Account: Your checking account will decrease the quantity of bounced checks.
  • Accounts Receivable: The balance of account receivable is going to be increased if the customer’s payment didn't undergo.
  • Bounced check fees: The bank takes a charge for non-sufficient funds (NSF fee).

In this article, you've got already known above the way to record bounced checks in QuickBooks. So, we hope that you simply can easily handle non-sufficient funds or bounced checks easily.

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