Credit memos in QuickBooks serve to debit customers for returns, discounts, or invoicing errors. To create credit memos in QuickBooks, click the Customers menu and select Create Credit Memos/Refunds. Select the customer and enter the items being returned or adjusted. The credit memo can be applied to an open invoice or a refund can be issued. Credit memos in QuickBooks ensure that what you reflect in your financial record as sales and payments is the truth. When a credit memo is created, QuickBooks automatically keeps your accounts receivable balance in sync, making it an easy way to manage transactions for a customer, thus providing the accuracy of your financial reports. Understanding how to handle credit memos in QuickBooks is key to good accounting practice.
