A credit memo is created any time a customer returns products or sold equipment is not used and is returned to your store. Think of a credit memo as a negative invoice.
Credit Memo List
The list of credit memos looks and functions just like the Invoices list and uses the same sort and filter options as described in the Invoices section of the manual.
Across the top of the window are your standard sort options:
The Credit Memos button indicates that credit memos are being displayed. Clicking on the button allows the user to navigate between sections in the accounting module.
The Sort button reorganizes the payments displayed by specific criteria.
- Aging – groups credit memos in current, 30+ days, 60+ days, or 90+ days past due
- Creation Date – sorts the credit memos based on the date they were created
- Customer Name – groups all credit memos together by customer name, sorted alphabetically
- Due Date – displays the credit memos grouped in days past due or paid status
- Ref Number – sorts the list by credit memo number
- Sales Staff – sorts the list based on the primary salesperson recorded on each credit memo
- Status – sorts the credit memos based on the credit memo status, as defined in Settings > Pop Up Lists > Invoice Status
The Options button has different ways of filtering the list of credit memos. Click here to see a detailed list of each filter option.
The New Credit Memo button opens a new credit memo window which functions just like the invoice window.
The Wild Card Search is used to search the entire list of credit memos for transactions that match the wildcard details entered.
- Type “Jim Carrey” to find all credit memos for Jim Carrey, for example.
- Type “123 Main St” to find any credit memo with an address containing 123 Main St.
- Type “181.50” to find any credit memos with a balance of $181.50.
Clicking on an individual credit memo in the list will open a new window with all the credit memo details.
The credit memo itself looks nearly identical to an invoice. You can see specific options on how to use a credit memo by referring to the Invoice Detail portion of this manual.
One major difference between an invoice and a credit memo is that the Payment button at the bottom has been replaced with a Credit Options button. Here you have a couple of different options on how to handle the credit memo.
- Apply To Invoice tab – this tab displays a list of all open invoices for the customer. By clicking the Select button to the right of an invoice, iPoint will automatically apply the credit to that invoice, reducing the balance due on the invoice. For larger credit memos, you can apply the balance to multiple invoices by clicking multiple Select buttons.
- You can partially apply a credit balance to an invoice by selecting the invoice and then adjust the Amount to Apply From Credit memo field to reflect the desired amount.
- Refund tab – this tab allows you to mark that the credit is not available because it has been refunded to the customer. Clicking the green Refund Balance AVailable button creates a pending transaction in the payment area and removes the balance from being applied to other invoices.
- The Details button next to the PENDING invoice allows you to Clear Pending Status indicating that a refund has been generated. Here you can also adjust the amount of the refund.
When a customer has a credit memo and you want to refund the customer their payment, there are two processes depending on if you are using QuickBooks Online or QuickBooks Desktop.
Refunds using QuickBooks Desktop
- In the Accounting Module, click the Credit Memos button.
- Enter your customer’s name and the products/services that are being returned.
- If you create a negative balance invoice, iPoint will prompt you to convert it to a Credit Memo.
- Click the QuickBooks button at the top right of the Credit Memo and sync to QuickBooks Desktop.
- In QuickBooks, open the Credit Memo and click the “Use credit to give refund” link at the top of the screen
- Once the payment is processed, go back to iPoint and open the Credit Memo.
- Click the QuickBooks button and then click the Pull Payments from QB button.
- iPoint will pull the payment you created in QuickBooks Desktop and zero out the Credit in iPoint.
Refunds using QuickBooks Online
- Create Credit Memo for your customer in iPoint.
- Click the QuickBooks button on the Credit Memo and check the “Do Not Sync with QuickBooks” checkbox.
- Now, create an Invoice for your customer in iPoint.
- The line item on your invoice will be Refund (or another related item you have created in the Items module).
- The amount of the Refund item will be the amount of the refund you paid/will be paying in QuickBooks Online.
- Click the New Payment/Credit button at the bottom of the invoice.
- Select the Credit Tab and select the credit memo you created in step 1. – This will zero out the CM and the invoice.
- Click the QuickBooks button at the top of the invoice and check the “Do Not Sync with QuickBooks” checkbox.
- Now you will have to manually enter the credit/refund transaction in QuickBooks Online as a Refund Receipt for your customer.
Apply to Open Invoices
You can also apply a credit memo directly on an open invoice. Once the Credit Memo has been created, follow these steps:
- Open the invoice by going to Accounting > Invoices and selecting the Invoice
- At the bottom of the screen choose the green New Payment/Credit button
- In the Payment window, click the Credit Memos (tab)
- Select the Credit Memo you wish to apply from the list by clicking the Select Button
- Enter the Amount to Apply in the window at the bottom of the screen. You can choose to apply the entire amount of the Credit Memo or a partial amount
- Click Apply
- Both the Credit Memo and Invoice balances will be reduced by the amount you chose to apply
For a complete explanation on how to process refunds with QuickBooks, watch this helpful video.