Creating a Credit Memo

To create a credit memo for a customer

1. Click on the Sales Command Center and choose 'Enter Sales'.
   
2. Enter the customer’s name.
   
3. In the body of the invoice, select the income account to which the credit is being applied. This would normally be the same income account from the original invoice.
   
4. Enter the amount as a negative number. For example, either -$250 or ($250).
   
5. Record the credit.
   
6. The credit will appear in the Sales Register under the 'Returns and Credits' tab.

To apply the credit

1. Select the credit and click on 'Apply to Invoice'.
   
2. This will bring up the 'Settle Returns and Credits' screen.
   
3. Choose to apply the credit to any open invoices. You can apply the entire credit or only a part of the credit.

When applying the credit, be sure that the amount of the credit at the top of the screen equals the amount applied at the bottom of the screen. Otherwise, the remaining credit will go to finance charge. If there is some credit left over, it will remain as an open credit for this customer.

To create a credit memo from your vendor

1. Click on the Purchases Command Center and choose 'Enter Purchase'.
   
2. Enter the vendor’s name.
   
3. In the body of the bill, select the expense account to which the credit is being applied. This would normally be the same expense account from the original invoice.
   
4. Enter the amount as a negative number. For example, either -$250 or ($250).
   
5. Record the credit.
   
6. The credit will appear in the Purchases Register under the 'Returns and Debits' tab.

To apply the credit

1. Select the credit and click on 'Apply to Purchase'.
   
2. This will bring up the 'Settle Returns and Debits' window.
   
3. Choose to apply the credit to any open bills. You can apply the entire credit or only a part of the credit.