apply bank debit to open cm

We have a client who has rental space, so when someone new moves in they pay a security deposit, and we process a payment against the tenant's credit card.  When the client moves, we issue a CM against the original security deposit and process a refund on the tenant's credit card.  How do I apply the debit that hits the bank to the open CM to close it?

I get that this is essentially just the reverse of the original transaction, but unlike the original (where we receive a payment and then make a deposit in QB), the CM is just open.  I'm thinking we should be able to "apply" the debit to the open CM?  My biz partner is an accounting pro and I'm trying not to trouble her with this as the cash is my responsibility.  Thank you!

Answer

Here is the issue: "but unlike the original (where we receive a payment and then make a deposit in QB), the CM is just open."

You make an Other Charge type item linked to Liability and use that on a Sales Receipt when they give you the security deposit.

You use it again on the Credit Memo, for the date you want to Apply it, Refund it, or both needs.

This also seems to be an error: "How do I apply the debit that hits the bank to the open CM to close it?"

You are not supposed to use something linked to Bank at this point.

Please see my attachment.

Now your Liability account can be managed by custom Transaction Detail reporting, set to total by Name, so that you can Reconcile it. Only and Always using an Ending Balance of 0, because the left and right sides you will checkmark only the activities for the name that is now at 0.

Make two versions of this report. One is All Transactions. The other is filtered on Cleared Status = No and this is Current Balances Only. And the reporting on that Item also shows balances and activities; or make one item for Security Deposit Received and the other is for Security Deposit Applied/Returned, but they both link to that same Liability account.

This assumes you do not also have a Trust Bank requirement. If you do, things are a bit different for using QB and Trust Banking.

Please see my attachments.



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