Hey there, @ArroyoStrategy.
I'd be happy to explain the difference between the Receive Payment and Credit Memo transactions. I'll outline a general explanation for each below:
This represents the actual flow of money from a customer to the business. When one or more invoices are paid, you can link this item to those transactions to reduce their Balance Due. The Payment will serve as a deposit in your bank register, or you can send it to Undeposited Funds to be included in a batch deposit. You can see the entire process of receiving a payment in the QuickBooks video tutorial or from the article here.
This is a multi-purpose transaction for crediting a customer balance. If the customer paid more than what was owed on the invoice, if they're returning a product or requesting a credit for a service, or if you're rewarding/gifting them with store credit, the Credit Memo can fulfill all of these roles. They're applied from within the Receive Payment screen by selecting any mix of open invoices and available credits for a given customer. For more information on creating and applying Credit Memos, check out video guide here or look into this article.
This information will help you decide which transaction to use for a given scenario. There are more common examples that can be found in the video links above. If you have any questions, or need any assistance getting these transactions created, be sure to let me know. Thanks for reaching out, have a wonderful rest of your day.