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XTek
July 19, 2024
Question

Credit Memo

  • July 19, 2024
  • 1 reply
  • 0 views

I purchased a LOT of product and registered at as a single item at the LOT price for my invoicing. I did this both for my PO to my vendor and the invoice to my customer. I recieved credit from my vendor for some shortage, which I recorded via a vendor credit without any errors. My issue is creating the customer credit, as it wants my to pick a "product/service" catagory. If I do this by entering "1" for the quantity and a credit amount of say $400, QBO appears to add back the entire amount of the purchase back. The same thing occurs if I do a refund receipt. 

 

If I just try to do a description wiht just the amount I get the " There is no income account associated with the item "Shipping". Is it marked for sale, and has an income account associated with it? " error which has nothing to do with what I am trying to do. 

Is there a way that I can do this without having to adjust the invoice to accomodate for this credit. Thank you 

1 reply

A
AbegailS_
July 19, 2024

Hi there, @XTek. 

 

I'm here to some guidance on the correct way to issue credits or refunds to customers in QuickBooks Online. 

 

When issuing a credit or refund to a customer, QuickBooks Online requires you to select a specific product or service item, and enter a quantity. This is necessary for QuickBooks to properly track and categorize the transaction.

 

If for some reason the standard credit memo or refund receipt options don't work for your specific situation, you can also record the credit as a journal entry. In that case, you would debit the sales/revenue account and credit the customer account directly.
 

On the other hand, here are the steps to create a journal entry:

 

  1. Select the + New button.
  2. Click Journal entry.
  3. On the first line, select an account from the Account field. Depending on if you need to debit or credit the account, enter the amount in the correct column.
  4. On the next line, select the other account you're moving money to or from. Depending on if you entered a debit or credit on the first line, enter the same amount in the opposite column.
  5. Check the amounts - you should have the same amount in the Credit column on one line and the Debit column on the other. This means the accounts are in balance.
  6. Enter information in the memo section so you know why you made the journal entry.
  7. Hit Save and new or Save and close.

This journal entry will directly post the credit to the relevant accounts, without impacting the quantities of any items.

 

With that, it's best to consult with your accounting professional first before making any changes to your accounts. However, if you don't have an accountant, you can find one here in our Resource Center. 

 

For more details about creating journal entries, check out Create journal entries in QuickBooks Online. 

 

Let me know if you have any other questions about handling customer credit in a specific situation.

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