How to record a bounced check in QuickBooks

• Use the Bounced Check Recording feature:
• Pick Customer Center from the Customers menu.
• Choose the Received Payments option from the Transactions tab.
• Double-click the payment you want to label as non-sufficient funds.
• Pick the Record Bounced Check icon on the Main ribbon tab in the Receive Payments window.

Please note that the check cannot be kept in the Undeposited Funds account until it has passed the bank; otherwise, it will bounce.

Enter the following details in the Manage Bounced Check pane, then click Next.

• • • Account for the Bank Fee and the Date Expense
    • Customer Class Fee (how much you will charge the customer)

• QuickBooks will show you the Bounced Check Summary so you can see what’s going on in the background. For instance, you could come across:
  • • The invoices below will be labelled as unpaid.
    • Your bank account will be debited for the following fees.
    • This invoice will be made for the fee you want to charge your client.

• Now after performing all these steps, you need to tap on option Finish.

Please note that all of these fields are optional. If there were no extra bank charges or you don’t want to charge your client, you can leave them blank.

 Keep a manual record of any checks that have bounced.

• To keep track of bounced checks and their associated costs, create an item and income account.

Please note that you just need to set this up once; if you’ve already done so, go to phase 2.

• Make a sales account:
  • Account Name: Bounced Checks Type:
  • Income Account Earnings

• Make a lousy check Item to charge.
  • Charge Type: Other
  • Bad Check is the name of the item.
  • Charge Percentage or Charge Amount: Set it to 0.00.
  • Code of taxation: non-taxable

• Bounced Checks Income should be selected as an account.
  • Select Make General Journal Entries from the Company menu.
  • Debit your account receivables for the same sum as the NSF search in the General Entries window.
  • In the Memo column, make a note about the transaction.
  • Bounced check #123 – NSF is an example of a bounced check.
  • In the Name column, type the name of the customer or job associated with the NSF search.
  • The initial deposit should be credited to the checking or bank account that got it.
  • Save & Close is the choice to choose.

• Transfer the invoice payment to the reversing journal entry.
  • Select Customers Receivables from the Reports menu, then Customer Balance Detail.
  • For the NSF transaction, double-click the original payment line.
  • Transfer the checkmark from the invoice to the reversing journal entry in the Receive Payments pane.
  • Save & Close is the choice to choose.

Please note that the balance of the bounced check will be deducted from your bank account. The invoice that produced the bounced check will be marked as unpaid.

• Reply to an open invoice.
  • Go to the invoice that was the source of the bounced search.
  • Add the charge for a bad check.
  • Choose to Send from the Email icon on the Main ribbon tab.

Please note that if you don’t want to charge your customer for it, you can skip this step if there were no additional bank charges.