Sometimes an admin or corporate entity purchases materials on behalf of a property — for example, buying supplies from Home Depot and billing the property with a markup.
If the property has already paid that bill and the item is later returned to the supplier, you’ll need to complete two separate accounting steps:
Refund the property back from admin/corporate payee
Record the refund properly on the admin/corporate books (if administrative accounting is being done)
This process ensures both the property and the admin entity are accurately balanced.
Example Scenario
Admin purchases materials from Home Depot
Property is billed for the materials plus markup payable to the admin/corporate payee
Property pays the bill
Later, the item is returned to Home Depot
Home Depot refunds the admin/corporate entity directly
Because the property already paid the original bill, the admin entity now owes that money back to the property.
Refund the Property
There are 2 options to refund the property
Transfer funds directly to the property for the refund
orCreate a payable credit that can reduce future amounts due to the admin/corporate entity
Option #1 Transfer funds and create a journal entry for the Property
A cash refund should be transferred from your corporate bank account to the bank account used for the property's trust bank
Journal Entry to record the property's received refund
Select: Journal Entry from Accounting, Tasks. Enter the
The affected property
The correct owner
The date the funds were transferred
Debit: select the bank account for the property's trust bank
Credit: select the expense account used for the original bill
Entry:
Record the Refund on the Admin/Corporate Side (if administrative accounting is being done as well)
Now record the opposite side under the admin/corporate entity. Select: Journal Entry under Accounting, Tasks
The Admin property/owner
The date the funds were transferred
Debit: select the revenue account used for the original invoice
Credit: select the bank account used for administrative accounting
Entry:
Option #2 Create a payable credit for the Property that can be applied to future bills
Funds do not need to be transferred. Instead the refunded amount will reduce a future payment to be made to the admin/corporate entity, for example the next management fee charged.
Payable credit to record the property's received refund
Select: Enter Bill from Accounting, Tasks. Enter the
The affected property
The correct owner
The date of the return
Select the expense account used for the original bill
Enter a negative amount to create the credit
If recording administrative accounts select Create revenue entry for...
After posting the payable credit, this can be applied to other payable bills by
Go to Payables
Select the credit and other bills payable to the admin/corporate entity
Click Post
If total is not 0.00, either adjust the amounts applied to each payable so that they balance to 0.00 or use the credit to reduce the total payment being made
What this does:
Reduces the original expense
Recognizes that the property has a credit to reduce future expenses
Why two entries are needed if administrative accounting is recorded in Propra
This situation affects two separate entities:
The property books
The admin/corporate books
Even though the refund originated from a single vendor return, both entities must be adjusted independently to keep accounting accurate.
Quick Recap
Property Entry
Debit Bank or Accounts Payable
Credit Original Expense Account
Transfer money back to Rent Trust or leave as a payable credit
Admin Entry for actual cash refund
Debit Original Revenue Account
Credit Bank
Best Practice Tip
Always use:
The original expense account on the property side
The original revenue account on the admin side
This keeps reporting clean and avoids creating unrelated adjustment accounts that can make future reconciliations confusing.