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debi8
Level 1

Applying a Credit Memo

I created a credit memo and I want to use it to clear the balance of an invoice.  I go to Receive Payment, enter the customer and then select both of the items, the credit and the invoice which has an open balance due equal to the amount of the credit ($340).  The "Amount Received" is not zero, which I think it should be because the credit cancels the debit.  It shows $340 as the amount received.  When I save this, I now have a new payment of $340 which is closed, and my invoice is paid in full.  However, my credit memo is still showing as unapplied.  If instead I zero out the amount received, then I get a message stating that the transaction will create an additional credit of $340.  I'm so lost at this point.  All I want to do is use the credit to close the balance due on the invoice.  Why is this so hard?

13 Comments
Pabz_L
QuickBooks Team

Applying a Credit Memo

Hello, @debi8.

 

If a customer paid you more than what was owed, returning a product, requesting a refund you can create a Credit Memo. Once done, you can apply it to an open invoice for a given customer. 

 

Since you’ve already received the payment from your customer, what you can do is delete the payment that you received so you can apply the credit memo to the invoice.

 

Here’s how.

  1. Go to the Sales menu.
  2. Select Customer.
  3. Find the customer that you wanted to apply for the credit memo.
  4. Click the Payment of the customer.
  5. On the Receive Payment window, click More.
  6. Then, select Delete.

 

Please refer to the screenshots below.

 

new1.PNG new2.PNG

 

Once done, apply your credit memo to the invoice.

 

  1. Click Sales from the left pane.
  2. Select Customers and click the customer’s name.
  3. Locate the invoice you want to apply the credit to and click Receive Payment.
  4. Enter the necessary information on the Receive Payment window.
  5. In the Outstanding Transactions section, make sure that the correct invoice is selected.
  6. Click Save and close.

 

For your reference you may check out this article about credit memo, credit, or refund. Enter and apply credit memos and delayed credits in QuickBooks Online.

 

Please let me know if you have any questions. I’ll be here to help. Take care and keep safe.

debi8
Level 1

Applying a Credit Memo

Once again I am having an issue in QBO trying to apply an open credit memo to a partially paid invoice.  Wen I go to "Receive Payment" and select both the invoice and the credit memo, the "Amount Received" is not zero even though the credit offsets the balance due on the invoice.  If I save it this way, the invoice shows as paid, but the credit memo shows as unapplied.  What are the correct steps to apply a credit memo to a partially paid invoice?

Jen_D
Moderator

Applying a Credit Memo

Glad you're back, @debi8,

 

Regardless if the sale is fully or partly paid, the steps are similar when it comes to applying a refund. If you're recording the payments manually, I've listed the step-by-step process on how to apply a credit to a partially paid invoice below:

 

Step 1: Create the invoice.

 

  1. Go to the + New button and choose Invoice.
  2. Fill in all the information of the sale and click Save.
  3. On the transaction, click Receive payment.
  4. Record the first partial payment by adding the exact amount received in the Payment field. If it shows the full invoice amount, edit it.
  5. Hit Save and close once the first payment is received.

Step 2: Create the Credit memo.

 

  1. From the + New icon, choose Credit memo.
  2. Enter the customer name to be refunded.
  3. In the Product/Service column, pick the item being refunded.
  4. Add the correct amount you are going to refund the customer before clicking Save and close.

Step 3: Apply the credit to close the invoice.

 

  1. Go back to the + New button and choose Receive payment.
  2. In the Customer field, choose the same client name the refund goes to.
  3. The result must show the remaining balance of this customer together with the credit memo.
  4. Mark the correct invoice number and the credit so the Amount received field shows 0.00.
  5. Once done, press Save and close.

You can also use the steps outlined in this article as your reference: Create and apply credit memos or delayed credits in QuickBooks Online

 

If the same behavior happens after following the steps, try logging in to a different browser or private window. Let's check if the problem is brought about by issues in the browser and its cache.

 

To launch a private window, try out these keyboard shortcuts:

 

Google Chrome: press Ctrl Shift N  
Mozilla Firefox: press Ctrl Shift P
Safari: press Command Shift N

 

Clearing the cache can also help resolve unexpected issues in QuickBooks Online.

 

Let me know how it goes or if you are using a different method of recording the payment. I'll be right here if you need further help with this topic or need anything else in QuickBooks. Have a nice day!

debi8
Level 1

Applying a Credit Memo

This is not working.  I tried going to a private window, the same thing happens.  I have an invoice for $400 that the customer paid $100 reducing the balance of the invoice to $300.  Then we issued a credit memo $300 to clear the balance of the invoice.  When I go to "Receive Payment" and I select the invoice with a balance of 300 and the credit memo for 300, the "Amount Received" at the top shows 300.  If I change it to 0.00 then it says this will create a credit transaction in the amount of 300. I'm totally lost.

debi8
Level 1

Applying a Credit Memo

Also, I noticed in your example that you are manually receiving a partial payment for the invoice and putting it into undeposited funds.  That is not how my partial payment is coming in.  We get a feed from our bank and when I select the invoices to be paid, I select the one for $400 and type in the amount they are paying of $100.  There is no opportunity to show this 100 as undeposited funds.

CharleneMae_F
QuickBooks Team

Applying a Credit Memo

Allow me to jump in on this thread, @debi8.

 

Since you're still unable to apply the credit memo to the invoice, I recommend contacting our Customer Care Team.

 

Here's how.

  1. Go to the Help menu.
  2. Click Contact Us.
  3. Provide a short description of your concern.
  4. Select Let's talk.
  5. You can either select Start messaging or Get a call to get an available representative.

 

Due to the pandemic, we have limited staffing and have reduced our support hours. To ensure that you'll be assisted on time, please check out our support hours.

 

Additionally, feel free to visit our Help articles page if you have other QuickBooks concerns, such as setting up advanced reports, online banking, managing reconciliation, transactions, import and export data lists, etc.

 

I'm always here to help if you need anything else, debi8.  Have a great day!

icon3
Level 1

Applying a Credit Memo

was what i have read it say receive payment and click more but there's no option more in my quickbooks online. How can i manage to use credit memo ?

icon3
Level 1

Applying a Credit Memo

where i can i find the HELP Menu button in Quickbook online?

AlexV
QuickBooks Team

Applying a Credit Memo

Hi icon3!

 

Thanks for joining us here! Let me show you how to use a credit memo.

 

You can apply the credit memo as the invoice payment. The steps above are only applicable if you recorded a payment already instead of applying for the credits. 

 

Here are the steps on how to receive a payment with a credit memo:

  1. Go to the + New and select Receive payment.
  2. Select the Customer. In the Outstanding Transactions section, select the open invoice you want to apply the credit memo to.
  3. In the Credits section, select the credit memos you want to apply.
  4. Make sure the total is correct after applying the credit memo.
  5. Tap Save and close.

 

You can also check the detailed steps here: Create and apply credit memos or delayed credits in QuickBooks Online.

 

In addition, the Help button is in the upper right corner. If you can't see it, you can click this link instead: https://help.quickbooks.intuit.com/en_US/contact.

 

Post again here if you need anything else. We'll respond as soon as we can.

SAMA2018
Level 1

Applying a Credit Memo

This is the same problem I have been having now for some time with Quickbooks online. 

You can not Apply a Credit Memo to an Invoice w/out receiving payment from customer.

If you go to Receive Payment to ONLY apply a Credit Memo it doesn't work. 

Amount Received zero, check the invoice with and enter amount of credit in Payment box. Then check the Credit Memo for same amount you get a negative amount in the Apply Credit section at end. Save and Close and you get a warning message that a negative Credit can not be applied.

 

However, I did find that if you go the the Customer click the green New Transaction drop down and select Payment it automatically applies the Credit Memo to the Invoice w/ a zero Amount Received and Apply Amount at the end is the Credit amount. Basically this is the only way I have found it to work properly.

 

The other features such as going through the Received Payment button or drop down arrow next to invoice on the customer info page will not work in the correct way to apply payment the way it should.

 

Major flaw with QB online with applying Credit Memos. 

 

Hopefully they can fix this and avoid a lot of clients headaches. 

SAMA2018
Level 1

Applying a Credit Memo

This is the same problem I have been having now for some time with Quickbooks online. 

You can not Apply a Credit Memo to an Invoice w/out receiving payment from customer.

If you go to Receive Payment to ONLY apply a Credit Memo it doesn't work. 

Amount Received zero, check the invoice with and enter amount of credit in Payment box. Then check the Credit Memo for same amount you get a negative amount in the Apply Credit section at end. Save and Close and you get a warning message that a negative Credit can not be applied.

 

However, I did find that if you go the the Customer click the green New Transaction drop down and select Payment it automatically applies the Credit Memo to the Invoice w/ a zero Amount Received and Apply Amount at the end is the Credit amount. Basically this is the only way I have found it to work properly.

 

The other features such as going through the Received Payment button or drop down arrow next to invoice on the customer info page will not work in the correct way to apply payment the way it should.

 

Major flaw with QB online with applying Credit Memos. 

 

Hopefully they can fix this and avoid a lot of clients headaches. 

ZackE
QuickBooks Team

Applying a Credit Memo

Thanks for joining the Community, SAMA2018.
 

You can follow AlexV's detailed steps to apply a credit memo to an invoice without receiving any money from your customer.
 

If for some reason you continue receiving a negative amount, I'd recommend getting in touch with our Customer Care team. They'll be able to pull up your account in a secure environment, conduct further research, and create an investigation ticket if necessary.

 

They can be reached while you're signed in.

 

Here's how:

  1. Use the Help (?) icon.
  2. Click Contact Us.
  3. Enter a description of your situation in the What can we help you with? field, then hit Let's talk.
  4. Select Start messaging or Get a call.


Be sure to review their support hours so you'll know when agents are available.
 

I'll be here to help if there's any questions. Have a lovely day!

SAMA2018
Level 1

Applying a Credit Memo

Been there done that with the Customer Care. They have no idea how to resolve the problem but to deposit funds into an Undeposited Funds account and do GJE. That is ridiculous that you have to go through those steps just to apply a Credit Memo to an invoice. 

A ticket was open months ago but I see the problem still exist. 

For now I'll just use the method I recommended in earlier reply.

 

 

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