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Post Info TOPIC: reimbursing an expense
Palawan


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reimbursing an expense
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I asked a related question awhile ago but still not sure I "get it".

A supplier  ( Intuit actually) accidentally took an extra payment by direct debit which I charged to a "computer software" expense account.

Supplier has now sent a cheque for the amount they took in error. Do you deposit this amount back into the original expense account,  or  do you deposit the amount into a  separate income-type reimbursement account.  Or can either way be used as long as it is consistent?

I ask as we have an income-type  account called "reimbursement: computer software" which I believe the previous book keeper set up and used.



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Palawan


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I guess what I am asking is: is it good book keeping to deposit money into an expense account?

I keep thinking money goes out of an expense account, receipts go into an income account.

 



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Robert Pearce


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As the payment was taken in error, I would post the reimbursement to the same place where you posted the original expense.

If you recharged an expense to another party, then I would post that type of reimbursement to an income-type account. 



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ClareB4


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I would also post to the original expense account and my reasoning would be that if not posted there then the expense account shows an incorrect balance for that expense for that year. That applies in this situation but in another scenario it may not, depending on the reason that the fee is being refunded

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Palawan


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Thank you


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fabs79


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I agree with the guys above. I would also post the amount reimbursed to you to the expense account used originally. And it is not bad bookkeeping to post on the credit side of an expense account, it's exactly what you do to deal with prepaid expenses. So no problem in doing that to adjust the expense account and make sure the balance is correct.

Fabs

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