Bounced check

There are several steps involved with a bounced check--here is the info from QB help (go there to click on the link for more details on any individual step).

When a customer's check is returned for insufficient funds, perform the steps described in this procedure.

To do this task:

Create items for tracking bounced checks and their associated charges (a one-time setup task).

Go to the Lists menu and click Item List.

Click Items at the bottom of the list and then click New.

Create an Other Charge item titled "Bounced Check."

In the Amount field, leave a zero amount.

From the Tax Code list, choose Non.

In the Account field, choose your bank account (for example, Checking).

Click Next.

Create a second Other Charge item titled "Bad Check Charge" for the service charge you assess customers for bounced checks.

Use this item when you reinvoice the customer to recover the service charge.

In the Amount field, leave a zero amount.

From the Tax Code list, choose Non.

In the Account field, choose an income account, such as Returned Check Charges. If the account doesn't exist, set it up now.

Click OK.

Use the items created in step 1 to reinvoice the customer for the bounced check, plus any bank fees you want to recover. This step also backs out the original transaction on your books.

Click Customer Center.

On the Customers & Jobs tab, select the customer with the bounced check.

Right-click and choose Create Invoices.

For the first line item on the invoice, use the Bounced Check item for the amount of the bad check.

Note: Because this item is linked to your bank account, this will reduce your bank account by the amount of the bounced check, thereby backing out the original transaction on your books. The income for the original sale will be recorded when you receive the new customer payment.

For the second line item on the invoice, use the Bad Check Charge item for the amount of any bank fees that you want to recover.

Complete filling out the invoice as usual.

(Optional) QuickBooks has a Bounced Check letter that you can send along with the new invoice.

Select the customer in the Customer Center.

Go to the Word menu at the top of the Customer Center and click Prepare Letter to Customer.

Follow the onscreen instructions in the Letters and Envelopes wizard.

In the Choose a Letter Template window, choose Bounced Check.

Enter your bank's bounced check charge when you reconcile your bank statement.

When you reconcile your bank statement:

Include your bank's charge for the bounced check in the Service Charge field.

In the Service Charge Account field, enter an expense account (for example, Bank Service Fees or Returned Check Charge).

PLEASE mark this answer as solved or post additional questions. Thanks so much!!!

Michelle L. Long, CPA, MBA

Author of the book "Successful QuickBooks Consulting: The Comprehensive Guide to Starting and Growing a QuickBooks Consulting Business"

National Trainer for Intuit Trainer/Writer Network

Advanced Certified QuickBooks ProAdvisor

http://community.intuit.com/me...

a lot of work just to post a bounced check!

debrakplus3--I totally agree! There are some other methods/workarounds too, but this is the 'official' method.

Michelle, Thanks for your detailed explanation.

Your method will result in double payment in the costumer payment report.

Is there any method to avoid the double payment in report? How about to create a credit memo to reverse the sale?

pickup168--that is the method from the QB help menu. There are other ways to do it too.