Hello, dlm0502.

You mentioned that a check bounced back in the bank feed and is now coded as a returned item in AP. As a result, your books show a paid expense and an open deposit owed to the vendor. I have another suggestion to help you zero out the expense. First, I recommend undoing the deposit coded to AP. After that, we can categorize and add the same bank and expense to offset the check bounce and expense. This should fix the current situation.

To undo the deposit, here's how:

1. Click the Transactions, and select Bank Transactions.
2. Under the Categorized Tab, choose the deposit and Undo it.
3. Then, from the For Review tab, Categorize the transaction and enter the same bank and expense info. Then click Add.

Once you have completed the above steps, you can re-deposit the check. This will enable you to pay the vendor you owe. To do this, you can write a check back to the vendor with the same expense and bank information. Here are the steps you can follow:

1. Click the + New, then select Check.
2. Enter the information with the same expense and bank info.
3. Tap Save and close.

For your reference, check the bank rules feature to help categorize your transactions automatically. Please check out this article: Set up bank rules to categorize online banking transactions in QuickBooks Online. Additionally, here's an article that you can read to help track where your company stands regarding expenses and accounts payable: Common custom reports.

If you require any assistance with this process, please do not hesitate to let me know. I'm more than happy to lend an extra hand. Have a great day!