How do I record a “partial refund” amount?

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How do I record a “partial refund” amount? I bought items for a friend at Costco, along with my own items. She refunds me for her items in cash. Do I have to create 2 transactions?
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GardenR

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Posted 1 year ago

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Alex Park, Official Rep

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Hi GardenR,

The best way to record that "partial refund" would be to add a new Credit transaction. You can enter a transaction as a credit by entering the Amount as a negative number (on the Web), by tapping the dropdown on the right of the Amount field and choosing "Credit" (on Android), or by choosing "Credit" from the Type menu at the bottom of the Add Transaction screen (on iPhone).

You would then enter the amount you're being refunded and then choose the Envelope and Account for that money to go back into.

Hope that helps!
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GardenR

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So I should make 2 transactions? The first is the original debit (VISA) transaction with the full amount of the purchase from Costco, dividing the amount into its appropriate envelopes. The second transaction is a credit (refund) going back to the same account and envelope.

Another method would be to create an envelope called "Unexpected Expenses" and don't fund it when I do a Fill. When I make the Costco debit transaction, I put my friends purchase amount into "Unexpected Expenses" envelope where it shows up in red until I record the credit reimbursement and it balances out. That way I have a record of these transactions (which I seem to do a lot of!).

I'm trying different ways of using Goodbudget to tell me what I need to know and keep track of. I am enjoying learning how to use it.
Thanks for the help
Bonita
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Wayne Woodbury

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That is what I would do (actually, I do this).  I have an envelope for one of my kids that still lives at home.  If I make a purchase for her while we are out, I record it under her envelope.  She reimburses me later at which time I record a credit transaction.  Furthermore, I have an account set up for "Cash on Hand" so that I can keep track of cash payments so that my envelope balances continue to match my account balances.  When I record a credit transaction that is paid in cash, I just specify the Cash on Hand account in the transaction.
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GardenR

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That makes a lot of sense. I’ll use the “Unexpected Expense” envelope to keep track of these transactions (like your daughters envelope) since they happen pretty often. Thanks Wayne...
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Wayne Woodbury

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GardnerR, I would add a couple of comments to what Alex said.  First, recording any refund, full or partial, as a separate transaction is probably the best way to go (as opposed to adjusting the original purchase transaction).  This is true especially if you use the Reconcile feature to reconcile your bank accounts with Goodbudget or is you use the Import feature to import transactions from your bank account.  This gives you a transaction that you can match to your bank/credit card account.

This also makes your income/expense reports more accurate.  You could record the refund as income, which would give you a transaction to match when reconciling accounts, but I believe this would throw off your reports as it would continue to show the refunded amount as an expense and would increase your income by the refunded amount.  Your account balances would be correct, but the reports would be skewed.

From an accounting perspective, Alex's suggestion is the best way to go.