How to Track Supplier Credits After a Return

To track a supplier credit, match the return slip to what happened next: a refund to your card or bank, a reduction on a bill, or a credit still available with the supplier. A return slip tells you the materials went back. It doesn’t always tell you where the money went.

Take a common situation. You buy six light fixtures for an installation, use four and return the other two. The person at the counter says, “We’ll credit you.” You tuck the slip into your jacket and head to the next job. Reasonable. Nobody puts “spend the afternoon thinking about two light fixtures” on the schedule.

A month later, though, it’s worth knowing whether you got that credit. Here’s how to check without turning it into a project.

Where should I look first?

Start with how you paid and what the supplier said at the counter. There are three places to look:

What the supplier did	Where to check	What you want to know
Refunded your business card or bank account	Card or bank activity	Did the refund post, and does the amount match?
Applied the credit to a bill	Supplier statement and bill detail	Which bill was reduced, and by how much?
Left a credit on your supplier account	Latest supplier statement or account history	How much is still available to use?

The third one is easy to miss. You could check your bank feed every morning for a month and never see it. Nothing moved through the bank. The supplier owes your business a credit toward a purchase instead.

What if the credit is smaller than I expected?

Look at the supplier’s credit memo, the document showing what they allowed for the return. Compare the item, quantity and amount with the original invoice. If you bought two fixtures for $100 each and received a $180 credit, check whether the memo lists a $20 restocking fee. If it doesn’t explain the difference, you now have a specific question for the supplier.

“Can you tell me why this credit is $180?” is easier for everyone to answer than “Something on our account looks funny.”

What if the credit lands on a different job’s bill?

Imagine the fixtures went back from the Maple Street job, but the supplier applies the credit when you buy supplies for Oak Street. The amount you owe the supplier may be perfectly correct. Your job costs can still tell the wrong story.

Maple Street should reflect the materials you kept for that job. Oak Street shouldn’t get the benefit of a return that had nothing to do with it. Otherwise, when you use those jobs to price the next installation, one looks more expensive than it was and the other looks like a bargain you may not be able to repeat.

Give your bookkeeper the original job name with the return slip. It’s a small detail for the person who made the return and a surprisingly hard detail for anyone else to reconstruct.

What should I send my bookkeeper?

A clear photo of the return slip and one sentence are a good start: “Returned two Maple Street fixtures on Friday. The supplier said the credit would come off our next bill.” Keep the original invoice or order number with it if you have it.

If you don’t know how the supplier handled it, say that. “Not sure whether they refunded the card” is useful information. It tells your bookkeeper to check before recording anything twice.

QuickBooks Online treats a vendor credit against bills differently from money refunded to an account. Before entering a new credit, check whether someone already recorded it or applied it to a bill. Intuit’s vendor credit and refund guide explains the different paths. quickbooks.intuit.com

Make it part of monthly bookkeeping

For one supplier you use regularly, pull the latest statement and pick one recent return. Can you point to the refund, the bill it reduced, or the credit still available? If you can, you’re done. If you can’t, write down the return date and amount so there’s one clear item to follow up.

That’s the value of monthly bookkeeping services here. Someone checks both sides: what happened at the supply counter and what ended up in your books. You get a supplier balance you can use and job costs that reflect what you actually kept.

Perlinger Consulting works with small business owners in Littleton, Centennial, the Denver Metro and beyond. Book a free 14-minute consultation with Glenn to talk about monthly bookkeeping.

Perlinger Consulting, Inc. | 720-290-4389
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