I appreciate your proactiveness in getting this solved, Clio. It can definitely get a bit tricky navigating these entries, but I've got you covered.

I'd like to focus on the second situation that you've provided while relating it to the original. Let's walk through the step-by-step process for handling the advanced payment and refund.

First things first, assuming you haven't recorded the advanced payment to the hotel yet, follow these steps:

1. Go to the +New icon and select Expense.
2. Choose the Vendor (Hotel) and enter the total advanced payment amount (360.60 EUR).
3. For Category, select Accounts Payable (A/P).
4. Make sure the date corresponds to when the payment was made. 
5. Select Save.

Secondly, create a Bill for the total invoice amount:

1. Go to the +New icon and select Bill.
2. Enter the Vendor (Hotel) and the invoiced amount (for example, you paid 200.00 EUR).
3. Pick the appropriate expense category. I encourage you to reach out to your accountant for accuracy.
4. Enter the billing date when you received the final invoice.
5. Click Save once everything is good. 

Next, link the advanced payment to the Bill:

1. Go to the +New icon and select Pay Bills.
2. Find the Vendor (Hotel) in the list.
3. Find the advanced payment transaction(360.60 EUR) and the invoice (200.00 EUR) listed. Apply the 200.00 EUR payment to the bill.
4. This will leave a credit balance of 160.60 EUR in Accounts Payable.
5. Select Save when done.

After this, record the refund as a Bank Deposit:

1. Go to the +New icon and select Bank Deposit.
2. Choose the bank account where the refund was received.
3. For Category, use Accounts Payable (A/P) and enter the refund amount (160.60 EUR), and set the Received from field as the hotel.
4. Lastly, click on Save.

Finally, apply the Bank Deposit to the Credit Balance to clear it out:

1. Go to the +New icon and select Pay Bills again.
2. Select the Vendor (Hotel).
3. Apply the Bank Deposit (refund) to the remaining credit balance, ensuring it zeros out.

These steps are crucial for maintaining accurate financial records. Step 1 acknowledges the initial payment in your balance sheet. Step 2 records the expense correctly within the appropriate category. Step 3 reduces the payable amount and acknowledges any credit due. Step 4 ensures the refund is recorded and linked to Accounts Payable, effectively closing the credit balance and preventing discrepancies.

In the future, you won't have a problem categorising the transactions correctly, and reconciling them to ensure accuracy.

But as always, please feel welcome to return to this thread again if you have more questions. You can tag me anytime or our Community experts will be there in a heartbeat. You got this, Clio!