Hi Procamdetailing,

Thank you for taking the time to get help with your vendor refund. I'll share with you some scenarios that will guide you through recording it.

Instead of using a refund account, you'll want to use the expense account of the item that you paid for. In this way, the posted expense in that account will be reversed.

If you purchased an inventory item using your bank account and your vendor returned the items with a refund, you can record the refund as a bank deposit and use the A/P account in it. It will turn into credits in your vendor's profile and becomes a matching entry to the downloaded transaction. On the other hand, you'll also want to create a vendor credit and use the same item to replenish its quantity.

After recording both transactions, you can link them together using an expense, as shown below. This will close them and prevent you from applying these credits as payments to future bills.

If you purchased an inventory item with a credit card, you'll enter a credit card credit. Then, use the same items to also increase its inventory count. That's the only thing you need to do for a refund to credit card purchases. This credit card credit can be a matching entry to the downloaded transaction.

You can also check about handling vendor credits and refunds for your additional reference.

I'm just around if you need more help managing your refund. Take care and good evening!