Question

You used your credit card a week ago, but are not happy with your purchase. You return the goods and the vendor refunds the amount directly to your credit card. If you don't have online banking, how do you record this transaction in QuickBooks?

Answer 1

To record a credit card refund in QuickBooks without using online banking, manually enter the transaction by creating a credit card credit in the QuickBooks credit card register with details of the refund. A credit card is considered a short-term loan, and a refund reduces the amount you owe to the credit card company.

Step-by-step explanation:

If you have made a purchase with your credit card and then returned the goods for a refund, the vendor will refund the amount directly to your credit card. The process for recording this transaction in QuickBooks, without using online banking, is to manually enter the transaction. This is done by creating a credit card credit transaction in your QuickBooks account.

To do this, you would navigate to the Credit Card Credit section under your credit card register within QuickBooks. Here, you would enter the date of the refund, the vendor who refunded the amount, and the refund amount itself. This transaction reflects that the vendor has transferred money back to the credit card company, reducing the amount you owe at the end of the month.

It's important to note that a credit card functions as a short-term loan; when you make a purchase, the credit card company pays the seller, and you are liable to pay back to the credit card company, typically at the end of the billing cycle. When processing a refund, this loan balance gets reduced by the amount of the refund.