I overpay supplier

1

Good day all

I have overpaid a supplier and he has paid the money back into my bank account.
I have googled how to handle this, but I only get explanations on how to handle it
when a customer overpays me.

trust that someone can point me on the right direction.

Best

2

You will have to handle this via a Journal Entry.
Lets say the amount due to supplier was Rs.40,000, you paid the supplier Rs.50,000, which means you overpaid the Supplier by 10,000. This will show a balance of 10,000 in your Supplier’s Ledger

Supplier%20overpayment
Supplier%20overpayment1434×694 42.8 KB

Supplier Ledger will look something like this
Supplier%20Ledger%20before%20refund
Supplier%20Ledger%20before%20refund1440×695 62.8 KB

When the Supplier refunds the money, you will have to pass a Journal Entry
34%20AM
34%20AM1437×693 58.8 KB

After the JV, Supplier Ledger will look like this
Supplier%20Ledger%20after%20Refund
Supplier%20Ledger%20after%20Refund1440×693 69.4 KB

Hope this helps

1 Like
3

Good day Manan_Shah

Many thanks for your response !

I am an engineer ( not an accountant !!! ) so I am very scared of this , but I will give it my best shot !!!

Best regards !!!

1 Like