QuickBooks Online is an accounting tool that simplifies various financial processes, including handling credit memos. Credit memos are essentially documents that specify the amount of credit a customer is due, typically due to refunds, returns, or adjustments to their invoices.
Applying a credit memo to an invoice is a common practice to reduce the amount a customer owes. Here’s how to do it:
Step 1: Create or Select a Credit Memo
- Under the “Customers” category, choose “Credit Memo.”
- You can either select an existing credit memo by choosing it from the list, or you can create a new one by clicking “Add a new credit memo” if it doesn’t already exist.
Step 2: Fill Out the Credit Memo
- Add the products or services that are applicable to the credit memo. QuickBooks Online allows you to add line items, specify quantities, rates, and applicable taxes.
- Ensure the total credit amount is accurate.
- Once all the information is filled out, click “Save and Close.”
Step 3: Apply the Credit Memo to an Invoice
- Go back to the ‘+’ icon at the top left corner of your dashboard.
- Under the “Customers” category, select “Receive Payment.”
Step 4: Choose the Customer
- In the “Receive Payment” window, choose the customer who is receiving the credit.
Step 5: Select the Invoice
- You will see a list of open invoices for that customer. Choose the one you want to apply the credit to by checking the box next to it.
Step 6: Apply the Credit
- In the “Outstanding Transactions” section, you will find the credit memo you created earlier. Select it.
Step 7: Review and Save
- QuickBooks Online will apply the credit to the invoice, reducing the total amount due. Review the transaction to ensure it’s accurate.
- Click “Save and Close” to complete the process.
