How Do I Enter a Credit Memo?

This article goes over the steps to enter a credit memo.

If your customer reports that the item shipped to them is damaged, or if a customer is requesting a refund, utilize the following steps to create a Credit Memo for the return. There are two ways to handle damaged goods depending on whether or not your company returns the product to stock, so that it can be returned to the vendor or the customer can be given credit and the item can be discarded. The manner in which you handle this situation depends on how you do business.

If you have the Business Activities Module (an add-on), you can enter a Return Merchandise Authorization (RMA) to efficiently manage returns. This will allow you to keep track of the returned product and related information by referencing the RMA number generated by the system. Refer to: Complete a Return Merchandise Authorization (RMA)

The Acctivate Credit Memo Window allows you to enter credit memos for your customers. To open the Credit Memo window, you have the following 3 options:

  1. Creating a credit from an existing Sales Order
  2. Going to Sales > Credit Memo
  3. Adding and utilizing the Credit Memo icon on your Icon Bar

Once the Credit Memo window is open, the user can begin entering or modifying the information on screen. The steps below cover entering a new credit memo from scratch. If creating the credit from an existing sales order, check out the instructions listed here. The process is also slightly different when doing so from a Business Activity window as a part of the RMA process.

  1. To create a new credit, click the New button. If you're wanting to open an existing credit, click the magnifying glass to select.
  2. If entering a new credit memo, add a Customer to the window by either typing the Customer ID and pressing tab or selecting from the lookup.
  3. Make sure all information is correct at the top of the the Detail tab, including PO and Ref information. (Billing Address, Shipping Address, Contact, Terms, Branch, etc.)
  4. Enter the product information for items being returned to your stock on the Detail Tab. The quantity should be a negative amount since it is a return on a product. Also check the unit of measure you are issuing the credit on.
    • If the customer is returning a kit, the components will be added back to your inventory. When they're returning one component, enter the component product itself into the details.
    • If you do not wish to add the stock back into inventory, select the line type of N for Non-standard and enter in the Product information manually. You can also create an 'N' line and name it "Return" if you'd like to simply type in the amount of money to be refunded.
    • If you wish to track returns or damaged items from your customers in a specific warehouse, add a Returns warehouse to the item and select on the Credit Memo.
  5. Choose the Price Code, if necessary, for the items by clicking the [...] button in the Pr Cd column
  6. Comments, Special Instructions or Shipping Instructions related to the Credit Memo may be entered at the bottom of any tab
  7. Any internal notes should be made on the Notes tab of the Credit Memo Window. These can be assigned to specific users for follow up, if necessary.
  8. If there utilizing the RMA process with Business Activities related to this credit memo, they can be found on the Activities tab. To create a Business Activity from the Credit Memo, click the New Activity button.
  9. When finished, click the Save icon to save the Credit Memo.
  10. When you're ready to complete the credit and add the items back into stock, click the Create Credit button.
  11. The Invoice Order window will open. If you have a more than one Credit Memo form, click the drop down next to Format to choose the proper report. You can enter an email address, tracking number, and shipping information all on this window. If you would like to print or email the Credit Invoice at this time, check the Print or Send boxes accordingly.
  12. Click Invoice to complete the Credit Memo.

For information about returning items to your vendor, check out this article.

For additional information about Credit Memos, check out our docs page.