How to permanently clear a $45.88 Undeposited Funds balance created by historical journal entries?

You can delete your correction journal entry first, then zero out your undeposited funds using a bank deposit instead of a journal entry. Crediting an account to Undeposited Funds via a journal entry does not clear its balance. Instead, QuickBooks Online treats it as an unmatched payment, creating a negative -$45.88 line on the Bank Deposit screen rather than fixing the issue.

Here is how to zero out your undeposited funds using a bank deposit:

1. Go to + Create and select Bank Deposit.
2. On the Select the payments included in this deposit screen, you will see the four original historical amounts. Check the ones that make up the $45.88.
3. Select the checkbox for each transaction you want to combine.
4. In the Add funds to this deposit section below, add an offsetting line for -$45.88, posting it to 68070 Bad Debt Expense.
5. Once done, click Save and close.

This clears the items out of Undeposited Funds and off the Bank Deposit screen in one transaction, with a $0 net effect on the bank account.

Let us know if you need further assistance.