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Magic Resource Center Article
Sometimes you may find it necessary to refund money to a member who has overpaid and has a credit balance in Magic. When you refund a member's credit balance with a check from your general ledger, you must also create an adjusting invoice in Magic. This ensures that the correct general ledger accounts are updated in your month-end journal entries. Sales Invoice Form:
Create a refund invoice in the Sales Invoice Form for the member that will receive the refund check. Zoom to select your charge code for refunds in the Code field and enter the amount to be refunded in the Unit Price field. Press your Escape key then click on the A/R button. The Cash Receipts Posting Form displays.
Leave the Amount field 0.00 and select N for Non-Monetary Transaction for the Payment Type. Tab through the remaining fields until your cursor highlights the Applied column of the refund invoice you just created. Click the Pay button, then highlight the credit balance and click Pay again. The offsetting amounts should equal 0.00. (Press Down Arrow or Up Arrow to have the software recalculate the Remaining to Apply amount.) Press your Escape key and then click the Post button. It is important to understand how overpayments and refunds affect your general ledger. When you create an overpayment invoice in Magic, the corresponding general ledger posting is a debit to Cash and a credit to Accounts Receivable. When you use the refund, it is a debit to Accounts Receivable and a credit to Refunds Payable. When you write a check from your general ledger package to the member, it is a debit to Refunds Payable and a credit to Cash.
The G/L Credit Account field for both your refund charge code and overpayment charge code in the Charge Code Table should point to a liability account for Refunds Payable in your general ledger. |
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