How to Record Credit Memos in QuickBooks 2014 - dummies

How to Record Credit Memos in QuickBooks 2014

By Stephen L. Nelson

Credit memos show when a customer no longer owes you money or when you owe a customer money. You can record credit memos in QuickBooks. Credit memos may occur because your customer returns items that you previously sold to him or her.

Credit memos may also occur because you issue a customer a refund for some other good reason; perhaps the product wasn’t of the quality that you usually sell or a service wasn’t provided in the manner in which it should have been.

To record a credit memo, follow these steps:

  1. Choose the Customers→Create Credit Memos/Refunds command to display the Create Credit Memos/Refunds window.

  2. Identify the customer, or the customer and the job, in the Customer: Job box.


    Use the Class box for class tracking if you’ve decided to do that. These boxes work the same way for credit memos as they do for invoices.

    The Create Credit Memos/Refunds window supplies a bunch of buttons on the various tabs that work the same way here as they do in the Create Invoices window: Previous, Next, and so on.

    As is the case with invoices, you can create custom credit memo forms. To do this, you click the Formatting tab’s Customize Data Layout button. Customizing a credit memo works the same way as customizing an invoice form. Refer to the earlier section on this topic if you have questions about how to customize a credit memo.

  3. Provide the credit memo date and number, and confirm customer information.

    Credit memos, like invoices and sales receipts, include a header. This header includes the transaction date, number, and the customer information. You should confirm that the credit memo header information is correct in the Create Credit Memos/Refunds window. If it isn’t, edit the default information that QuickBooks uses to fill the Create Credit Memos/Refunds window.

  4. In the columns area, describe the reason for the credit memo.

    If the customer returned items, for example, use the columns to describe these items and the original price that you’re refunding.

  5. Click the Print button to print the credit memo.

    Note, too, that you can print credit memos in a batch. Obviously, after you print credit memos, you need to distribute them.

  6. Click either Save & Close or Save & New to save the credit memo.

    At the time you save your credit memo, QuickBooks allows you to indicate what you want to do with it: retain it for later application to a customer invoice, immediately apply it to a customer invoice, or issue a refund check. You write a refund check the same way that you write other checks.