Return Inventory & Restocking Fee Help

[Mark]

::Quickbooks 2003 Premier::

I'm not really sure how to do this. I have an inventory item that I
have paid for via a purchase order -> Received Items & Enter Bill ->
Pay Bills. So it is in my inventory and paid for.

I have now returned the item to the vendor and he has sent me a check
for the part minus a restocking fee. How do I properly account for
this? I need to reduce the Inventory Asset account by the full price
of the product ($256) and then deposit the refund ($246) and some how
deal with the $10 restocking fee as a loss or expense.

What would be the best way to handle this?

Thanks in advance!

[Joyce C.]

The first thing you have to do is to create a credit memo to that
vendor for the item you are returning. Go to the enter bills screen
and change it from a bill to a credit at the top left. Then enter the
vendor name and info. Enter for the Amount the item cost less the
restocking fee. You need to create an Other Charge type item called
Restock Fee with a description of: Restocking Fee on Returned
Inventory Item. Leave the Amount blank as you will have to enter that
manually. For the Account you can use your Cost of Goods Sold account.
Now, on the Items tab of the Credit Memo, enter the qty and the item
you are returning. Drop to the next line and select your Restock Fee
item. Tab over to the Amount column and enter the amount of the
restock fee as a negative number into that column. If the fee was
$15.00, then enter it like this: -15.00 and hit your tab key. Now
the credit memo should be the same amount as the refund check you got
back. Record this credit memo. The item will be removed from your
inventory and the restock fee will be charged to your COGS account.
Your vendor AP account will show they owe you a credit. To record the
refund check just go to your Make Deposits screen and in the Received
From column select your vendor's name. Enter the Amount and in the
From Account column select your Accounts Payable account. Enter Refund
in the Memo column and the Chk No and pay method, if you wish. Reocrd
it. Now the only thing left is to "connect" the refund check with the
credit you entered in the AP account so it clears out of there on your
aging reports. To do this go to Pay Bills and you will find the
deposit entered there. Select it and click the Set Credits Button and
select the credit memo you entered and click Done and record it.
Everything will be recorded and cleared out now.

[Mark]

Wow thanks soooo much! I would never have figured that out.

Again thanks!

Mark

Post by Joyce C.
The first thing you have to do is to create a credit memo to that
vendor for the item you are returning. Go to the enter bills screen
and change it from a bill to a credit at the top left. Then enter the
vendor name and info. Enter for the Amount the item cost less the
restocking fee. You need to create an Other Charge type item called
Restock Fee with a description of: Restocking Fee on Returned
Inventory Item. Leave the Amount blank as you will have to enter that
manually. For the Account you can use your Cost of Goods Sold account.
Now, on the Items tab of the Credit Memo, enter the qty and the item
you are returning. Drop to the next line and select your Restock Fee
item. Tab over to the Amount column and enter the amount of the
restock fee as a negative number into that column. If the fee was
$15.00, then enter it like this: -15.00 and hit your tab key. Now
the credit memo should be the same amount as the refund check you got
back. Record this credit memo. The item will be removed from your
inventory and the restock fee will be charged to your COGS account.
Your vendor AP account will show they owe you a credit. To record the
refund check just go to your Make Deposits screen and in the Received
From column select your vendor's name. Enter the Amount and in the
From Account column select your Accounts Payable account. Enter Refund
in the Memo column and the Chk No and pay method, if you wish. Reocrd
it. Now the only thing left is to "connect" the refund check with the
credit you entered in the AP account so it clears out of there on your
aging reports. To do this go to Pay Bills and you will find the
deposit entered there. Select it and click the Set Credits Button and
select the credit memo you entered and click Done and record it.
Everything will be recorded and cleared out now.