If you turned off the feature, here's how to manually apply a credit memo to an invoice:
- Select + New.
- Select Receive payment.
- In the Customer dropdown, select the customer.
- In the Outstanding Transactions section, select the open invoice you want to apply the credit memo to.
- In the Credits section, select the credit memos you want to apply.
- For the open invoice in the Payment column, enter how much of the credit you want to apply.
- Leave the Payment method, Reference no, Deposit to, and Amount received fields blank.
- Fill out the rest of the form, including the Payment date.
- Make sure the total is correct after applying the credit memo.
- When you're done, select Save and close.
Step 1: Turn on the credit memo auto-apply feature
If you haven't already, you can tell QuickBooks to automatically apply credit memos to customers' balances or open invoices. To turn on the credit memo auto-apply feature:
- Go to Settings ⚙ and select Account and settings.
- Select Advanced tab.
- Select Edit ✎ in the Automation section.
- Select Automatically apply credits.
- Select Save, then Done.
Tip: You can turn off this feature if you want to decide which open invoices you want to apply credit memos to.
Step 2: Create a credit memo
- Select + New.
- Select Credit memo.
- In the Customer dropdown, select the customer's name.
- Enter the credit memo details, such as the date and the amount. Tip: You can create a custom credit service item so you can quickly add it to credit memos as a single line item.
- When you're done, select Save and close.
Step 3: Apply the credit memo to an invoice
If you turned on the credit memo auto-apply feature, QuickBooks handles this for you. Your work is done and QuickBooks applied the credit for you.
If you turned off the feature, here's how to manually apply a credit memo to an invoice:
- Select + New.
- Select Receive payment.
- In the Customer dropdown, select the customer.
- In the Outstanding Transactions section, select the open invoice you want to apply the credit memo to.
- In the Credits section, select the credit memos you want to apply.
- For the open invoice in the Payment column, enter how much of the credit you want to apply.
- Leave the Payment method, Reference no, Deposit to, and Amount received fields blank.
- Fill out the rest of the form, including the Payment date.
- Make sure the total is correct after applying the credit memo.
- When you're done, select Save and close.