How to record and refund a customer overpayment

To record an overpayment

1. Go to Customers & Sales (or Receivables).
2. Open Receipts, then Create Receipt.
3. From the menu, select Receipt.  Select Enter Deposits to enable the Deposit Amount field.
4. Select the Customer ID.
5. Enter the amount you’re paying against the invoice in the Amount Received column. The Amount Received can't exceed the invoice total.
6. Enter the overpayment amount into the Deposit Amount.  This amount records to the Prepaid Sales/Deposit account.
7. Select Process.

To record a refund

1. Go to Customers & Sales (or Receivables).
2. Open the Receipts, Create Receipt and create a second receipt.
3. Select the Customer ID.
4. Select Paid By Cheque.
5. Select the correct bank account from the Deposit To drop-down list.
6. Select the Deposit amount in red and enter the Amount Received as a positive number. 
7. The total displays as a negative amount.
8. Select Process.
9. Select Yes on the Confirmation window.

 NOTE: Instead of a refund, you can apply the overpayment to an unpaid invoice. To do this, enter the invoice amount in the Amount received column opposite the invoice in question. Then enter the amount of the deposit in the same column on the deposit line. 

To print the refund cheque

 NOTE: If you write cheques by hand, skip this step. 

1. Go to the Vendors and Purchases (or Payable).
   
2. Select Vendors, Add Vendors and add a new Vendor named customernamerefund. For Example: ABC123refund.
3. Save the Vendor record.
4. Open Payments, Pay Remittances window.
5. In the upper left of the window, select Make Other Payment.
6. Select By Cheque.
7. Enter the Cheque No.
8. For Pay to the Order Of, select the vendor from Step 2 above. 
9. Select any account in the Acct field.
    NOTE: It doesn't matter which account you use. The cheque won't process or save and won't affect the general ledger.
10. Enter the refund Amount.
11. Enter the Invoice/Ref. and Comment if desired.
12. Print the cheque without selecting Process.
     CAUTION: Don't post this transaction. Recording the receipt and refund above has reversed it.
    
    
13. After printing the cheque, close the window and confirm to discard the transaction.

How to enter a customer deposit