Refund from supplier cash debited supplier credited the amount of supplier is decreased why??

Hi there, @911959. I'm here to provide some info about handling supplier refunds in QuickBooks Online (QBO).

Let's ensure that you record the supplier refund accurately in QBO. To do so, you'll need to enter a supplier credit for the expense that the refunded payment was applied. After that, create a deposit for the money received. Then, link the deposit to the credit memo with a zero-dollar payment. Follow along below to get this done right away. 

Enter a Supplier credit and ensure that it hits the expense account you use for this supplier:

1. In your QBO account, select the + New button. 
2. Next, choose Supplier credit.
3. Then, in the Supplier field, pick the supplier's name.
4. Depending on how you record purchases with this supplier, enter the Category details or Item details. Usually, this is the category, product, or service you’re getting credit for.
5. Once done, select Save and close.

After that, deposit the money:

1. Go back to the + New menu.
2. Next, select Bank deposit.
3. From the Account dropdown menu, choose the account where you got the refund.
4. Then, in the Add funds to this deposit section, fill out the following fields.
   • Received from: Pick the supplier who gave you a refund.
   • Account: Choose Accounts Payable. To link the refund to the supplier credit. 
   • Payment method: Enter the method your supplier used to refund you.
   • Amount: Input the amount of your refund.
5. When finished, select Save and close.

Then, to connect the bank deposit to the supplier credit, you can use the pay bills feature. 

For reference, feel free to open these articles:

• Enter a refund from a supplier
• Handle supplier credits and refunds in QuickBooks Online

I'd also recommend asking for guidance from your accountant to make sure everything will be recorded correctly. 

Keep me posted on how the steps go. I'm always here ready to lend a hand to ensure your success. Have a good day ahead.