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Handling a customer credit

From: QuickBooks Pro 2010 Essential Training

Video: Handling a customer credit

If a customer complains about an order or sends products back, you can either issue a credit to the customer toward their next order, or refund their money. To record a customer credit in QuickBooks, you create what's called a code memo. Once you do, you can apply that credit to a future invoice to reduce what the customer has to pay or you can issue a refund check. To get started, on the homepage click Refunds & Credits. The Create Credit Memos/ Refunds window should look familiar.

Handling a customer credit

If a customer complains about an order or sends products back, you can either issue a credit to the customer toward their next order, or refund their money. To record a customer credit in QuickBooks, you create what's called a code memo. Once you do, you can apply that credit to a future invoice to reduce what the customer has to pay or you can issue a refund check. To get started, on the homepage click Refunds & Credits. The Create Credit Memos/ Refunds window should look familiar.

It looks almost exactly like the Create Invoices window. And if you look carefully, you will notice that QuickBooks assigns the next invoice number as the credit memo number. In the Customer:Job dropdown list, choose the customer you are giving the credit or refund to, Condo Coop in this example. Choose the Date in the Date box if it isn't the one you want already. Like when you create an invoice, you fill in lines in the table for what you are giving credit for. For example, if you are giving credit for services or products you sold, you fill in the item in the Quantity but as positive numbers.

For example, this refund is going to refund Brushed Nickel Door Knobs, 3 of them. QuickBooks fills in the description and the rate from the item record and calculates the amount of the credit. It also calculates the sales tax to refund too. If you want to record a memo to yourself about the credit, fill in the Memo field. Then when you are done, click Save & Close to save the memo and close the dialog box.

The Available Credit dialog box opens with three options for handling a credit. To keep the credit around to use later, leave the Retain as an available credit option as it is. This is a good choice if you don't have an open invoice for the customer, and the customer hasn't asked for a refund check. If you want to write a refund check, you can do that right away by selecting Give a refund and then clicking OK. The Issue a Refund dialog box opens.

QuickBooks has all the fields filled in so you can click OK to print the check. If you want to change the date, the payment method or the account, do that before clicking OK. If you decide to write a refund check later, open the Create Credit Memos/Refunds window later on. Go back to the credit memo. In the toolbar, click the icon of a dollar bill with a hand above it. The Available Credit dialog box opens again.

If you have an open invoice for the customer, you can apply the credit to that invoice. Select Apply to an invoice to open the Apply Credit to Invoices dialog box. Suppose you do not have an open invoice so you keep the credit around to apply to an invoice later on. When you are ready to apply the credit, you don't have to do that in the Create Invoices window. You actually use the Receive Payments command. If you think about it, applying a credit to an invoice is like the customer sending you a payment.

On the homepage, click Receive Payments. Choose the customer with the credit in the Received From dropdown menu. Select the invoice that you want to apply the credit to by clicking anywhere in the invoice line except the first column. Clicking the checkmark column selects the invoice for a real payment. Then click Discount & Credits. In the Discount & Credits dialog box, QuickBooks automatically applies the credit.

Click Done to get back to the Received Payments window. You will see the Credits column in the table with the credit applied. Click Save & Close to save the invoice with the credit applied. There is one other way to apply a credit to a new invoice you create. So create a new invoice for the customer and add some items to it. When you do, the Apply Credits button comes to life.

To add a credit, click Apply Credits. Click Yes to record the transaction before continuing. The Apply Credits dialog box opens, which looks a lot like the Discount & Credits dialog box. Turn on the checkmark for the credit and click Done. You will see the credit applied to the invoice and the balance reduced by that amount. Click Save & Close to save the invoice.

The easiest way to handle credits is to apply them to an invoice right away or to write a refund check. But you can keep credits in place and apply them whenever the customer asks you to.

Show transcript

This video is part of

Image for QuickBooks Pro 2010 Essential Training
QuickBooks Pro 2010 Essential Training

69 video lessons · 22293 viewers

Bonnie Biafore
Author

 
Expand all | Collapse all
  1. 8m 19s
    1. Welcome
      52s
    2. Editions of QuickBooks
      3m 24s
    3. QuickBooks bookkeeping basics
      2m 46s
    4. Using the exercise files
      41s
    5. Disclaimer
      36s
  2. 9m 12s
    1. Opening a company file
      2m 4s
    2. Using the QuickBooks menus and home page
      2m 49s
    3. Touring the Customer, Vendor, and Employee Centers
      2m 32s
    4. Navigating between QuickBooks windows
      1m 47s
  3. 10m 50s
    1. Gathering the information you need
      2m 4s
    2. Creating a company file
      5m 33s
    3. Converting from another program
      3m 13s
  4. 8m 19s
    1. Naming and numbering accounts
      3m 36s
    2. Creating an account
      2m 26s
    3. Making an account inactive
      2m 17s
  5. 14m 50s
    1. Creating a customer profile
      3m 40s
    2. Adding customer information
      4m 33s
    3. Creating a job
      2m 18s
    4. Making customers inactive
      1m 39s
    5. Creating a vendor
      2m 40s
  6. 43m 35s
    1. Why use QuickBooks items?
      2m 59s
    2. Creating a service item
      4m 26s
    3. Setting up time tracking
      2m 53s
    4. Entering time
      4m 19s
    5. Tracking mileage
      4m 34s
    6. Creating an inventory item
      6m 7s
    7. Creating a non-inventory item
      3m 34s
    8. Setting up sales tax
      6m 59s
    9. Setting up discounts and charges
      3m 46s
    10. Creating a group of items
      2m 16s
    11. Making items inactive
      1m 42s
  7. 30m 46s
    1. Creating a purchase order
      3m 8s
    2. Entering a bill
      4m 37s
    3. Recording inventory you receive
      3m 47s
    4. Paying bills
      4m 5s
    5. Handling a credit from a vendor
      5m 2s
    6. Writing a check for expenses
      3m 17s
    7. Paying with a credit card
      1m 40s
    8. Paying with cash
      2m 53s
    9. Paying sales tax
      2m 17s
  8. 35m 5s
    1. Understanding invoices, statements, and sales receipts
      2m 23s
    2. Creating an invoice and filling in header fields
      2m 55s
    3. Adding items to an invoice
      5m 7s
    4. Adding billable time and cost to an invoice
      5m 57s
    5. Using subtotals, discounts, and other charges
      3m 6s
    6. Creating an estimate
      2m 49s
    7. Handling a customer credit
      4m 57s
    8. Creating a statement charge
      3m 7s
    9. Producing a statement
      4m 44s
  9. 14m 44s
    1. Setting up print options
      4m 13s
    2. Aligning forms with printer paper
      3m 0s
    3. Printing one or more forms
      4m 29s
    4. Emailing a sales form
      3m 2s
  10. 14m 8s
    1. Receiving a payment
      3m 49s
    2. Assessing finance charges
      4m 9s
    3. Creating a sales receipt for a cash sale
      2m 39s
    4. Depositing payments
      3m 31s
  11. 10m 37s
    1. Preparing to reconcile a bank account
      1m 50s
    2. Reconciling transactions to your bank statement
      3m 14s
    3. Correcting discrepancies
      5m 33s
  12. 9m 51s
    1. Using the Report Center to find reports
      3m 0s
    2. Running a report
      3m 45s
    3. Printing or saving a report
      3m 6s
  13. 6m 8s
    1. Why use journal entries?
      3m 3s
    2. Creating a general journal entry
      3m 5s
  14. 13m 39s
    1. Creating a new user
      4m 58s
    2. Backing up your company file
      6m 10s
    3. Restoring a company file
      2m 31s
  15. 27s
    1. Goodbye
      27s

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