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Bounced Checks

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  • Bounced Checks


    I have some questions about bounced checks. Under the help index, Qbks tells us to create items to track bounced checks and their associated charges.

    1 From the Lists menu, choose Item List.
    2 Click the Item menu button and choose New.
    3 Create an Other Charge item titled "Bad Check."

    In the Amount field, leave a zero amount.
    Clear the Taxable checkbox.
    In the Account field, choose your bank account.

    4 Click Next.
    5 Create an Other Charge item titled "Bad Chk Chrg" for the service charge you assess customers for bounced checks.

    In the Amount field, leave a zero amount.
    Clear the Taxable checkbox.
    In the Account field, choose an income account, such as Returned Check Charges. If the account doesn't exist, set it up now.

    6 Click OK.

    I did exactly like they said but I think the "Bad Check" item should be linked
    I am recording the bounced checks is by using Joey's method of writing a check, changing the number to "debit memo", and using the two items Qbks told me to create ("Bad Check" and "Bad Chk Chrg").

    My questions are:

    1. Isn't the "Bad Check" item supposed to be linked, some how, to the daily sales account (income)?
    2. Isn't the "Bad Chk Chrg" item supposed to be the charge the bank charged me for the returned item, not the service charge I assess customers for bounced checks?
    3. When I get reimbursed for the bounced check plus the service charge assessed for bounced checks from the customer or their bank, how do I record this? I know I probably have to go under deposits but what account do I link it to?


    P.S. I want to thank Joey for e-mailing me right away about my question yesterday, I hope he can help me with this today.

  • #2
    I see that you have not had a reply, I will look into it and if satisfied, will post suggestions

    Sidney Schultz
    Schultz & Associates
    Vancouver, BC Canada
    Phone 604-632-3829


    • #3

      I would appreciate it


      • #4
        Bad Check

        I create an invoice for the customer that issued the bad check and use the items you set up (bad check and bad check fee). Then when the customer pays you for the bad check, you can apply it to A/R just as you would any other customer payment of an invoice. The bad check fee I link to the bank service charge expense account so that it will offset the charge from the bank rather than showing as an income account. The bad check item is linked to the bank account. So when you create the invoice, the bank account is credited.
        I use QBP 99....I assume this method would work in other versions too.