How to Properly Record a Bounced Check in QuickBooks- A Step-by-Step Guide_1

How to Record Bounced Check in QuickBooks

Bounced checks, also known as NSF (Non-Sufficient Funds) checks, can be a hassle for both businesses and individuals. When a check bounces, it is important to properly record the transaction in QuickBooks to keep your financial records accurate and up-to-date. In this article, we will guide you through the process of recording a bounced check in QuickBooks.

Step 1: Identify the Bounced Check

The first step in recording a bounced check in QuickBooks is to identify the check that has been returned due to insufficient funds. This can be done by checking your bank statement or by receiving a notification from your bank.

Step 2: Open QuickBooks and Navigate to the Bank Account

Once you have identified the bounced check, open QuickBooks and navigate to the bank account where the check was deposited. This can be done by clicking on the “Banking” tab at the top of the screen and selecting the appropriate bank account.

Step 3: Create a Journal Entry

To record the bounced check, you will need to create a journal entry. Click on the “Journal Entry” button located in the upper-right corner of the screen. This will open a new journal entry window.

Step 4: Enter the Date and Description

In the journal entry window, enter the date of the bounced check in the “Date” field. In the “Description” field, enter a brief description of the transaction, such as “NSF Check 12345.”

Step 5: Enter the Account Details

Next, you will need to enter the account details. In the “Debit” field, select the “Bank Service Charge” account, which is typically used to record bank fees. In the “Credit” field, select the “Accounts Receivable” account, as the customer who wrote the bounced check now owes you the amount of the check.

Step 6: Enter the Amount

Enter the amount of the bounced check in the “Debit” field. This amount should match the amount of the bank service charge. In the “Credit” field, enter the same amount to reflect the increase in accounts receivable.

Step 7: Save and Close the Journal Entry

After entering all the necessary information, save and close the journal entry. This will record the bounced check in QuickBooks.

Step 8: Update the Customer’s Account

Finally, update the customer’s account to reflect the bounced check. Go to the “Customers” tab, select the customer who wrote the check, and click on “Edit.” In the “Account Details” section, enter the amount of the bounced check in the “Balance” field. This will ensure that the customer’s account accurately reflects the amount they owe.

By following these steps, you can easily record a bounced check in QuickBooks and maintain accurate financial records. Remember to always keep your financial records up-to-date and consult with a professional if you have any questions or concerns.