So, you have customer credit or refund that you want to apply to customers’ accounts in QuickBooks. There is a list of easy steps that you need to follow to do this in QuickBooks. You can handle it either by giving the refund back to the customers or maybe create a credit note. You will have to first decide how you want to handle the credit, there are a few options which you can choose from:
- Retain the amount as available credit in the customer account i.e., QuickBooks will enter a negative amount in the Account receivable register for the credit note. This credit can be against other future payments.
- Refund or money back i.e., you can pay this money back to the customers in the form of cash, check, or through online mode.
- Apply the credit to the invoice i.e., you can also apply the credit to the customers’ invoice in QuickBooks.
How to create a Credit memo to apply them to a customer’s invoice?
If you have chosen the third option and want to apply the credit memo to the customer’s invoices, you can do so by first creating the credit memo. You need to follow the below steps to do so:
- First of all, open the QuickBooks and click on the plus (+) icon.
- Now you need to select the credit memo and choose the customers’ name.
- Now you need to enter the credit memo date > fill in the date of service, product and service details, and also the amount details. Also, ensure other details in case it is required.
- In the last step, click on save, and close to finishing the process.
How to apply the created credit memo to the customer’s invoice in QuickBooks?
- At the start, you need to click on sales in the left navigation bar and click on the customer’s tab.
- After that, you need to find and click on the customer’s name and find the invoice that you want to apply the credit to, and after that, you have to click on receive payment.
- Now under the Receive payment heading, you need to fill in the date of the payment, method of payment, deposit to account details, reference number details in case it is required.
- Now you need to go to the Outstanding transaction section and verify that the correct invoice is selected and then go to the credit section to check whether the correct credit memo is chosen.
- After verifying all the information, you just need to click on save and close to finish the process.
You should ensure that amount and other information are correctly entered in the above process steps to accurate application of the credit memo to the customer’s invoice. Credit notes or memos will impact sales reports, irrespective of the fact that they are applied to the invoice or not.
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