Credit Card Transaction return how to categorize it!
Interesting situation and for the life of me cant figure out how to input this correctly, The other day I went and bought a few things from Family Dollar. They were all categorized as Household Durables, the next day I returned one item and bought some hair ties instead. When the transaction was done instead of them crediting my card they exchanged the product then gave me 3.50 in cash back. I am trying to figure out how to input the return so each category is correct and my cash account will accurately reflect the cash back that I got. How should I handle this? Since the return didn't even hit the credit card at all but I do have 3.50 in cash now. So lost for some reason!
Don't adjust the transaction at all. Just move money between your Household Durables budget and whatever category you use for hair ties until you're happy with how much is in each category. Yes, this means you have some spending miscategorized, but the amount is probably to small to worry about in the long run.
And if you use a Cash account, add a deposit for $3.50 to it.
I actually prefer every thing to accurately be reflected in the accounts and to the right categories and there wasn't a deposit in the cash account with outside monies so don't want to reflect as extra cash or income but when I tried inputting the cash as an transfer from my Discover card it put it in as overspending from that account in the actual register and put the monies in my TBB, hence my original question how this should be handled, I maybe OCD about this but its important to me to have the right spending in the right places.
Thank you for all your help @mamster, I did it exactly how you said it works for accounting but why is my Credit card showing 3.50 overspent in my register?? Is there a way to fix this? It probably doesn't really matter in the grand scheme of things bit I hate seeing overspending anywhere. It is a paid in full card not sure if that matters in this case but gosh that yellow bugs me!