Creating Invoice Credit Memo

Invoice Credit Memo allows users to generate credit memos directly from an invoice. This is particularly useful when processing product returns, as it enables users to credit inventory back into stock while issuing corresponding credits to customers.

An invoice credit memo can be generated directly from an invoice or created manually from the respective module. Creating an invoice credit memo involves selecting the invoice and invoice lines to credit, specifying return details, and adding additional lines as needed, ensuring a streamlined and flexible workflow for handling returns.

Creating Invoice Credit Memo from the Invoice

An invoice credit memo can be created directly from the invoice. This method is particularly useful when dealing with product returns. You can record the return of inventory and issue the credit.

To create an invoice credit memo, go to Invoice > Options > Create Invoice Credit Memo

You will be navigated to the Invoice Credit Memo module and asked to select the invoice lines to add to the credit memo.

Select Invoice Lines to Credit Fields

Field	Description
Return Inventory Store	This dropdown menu allows you to select the store to which the item(s) will be returned.
Available To Credit	This is the qty of item available to be credited.
Credited	This is the qty of the item being credited.
Credit Qty	This field allows you to add the item qty in the credit memo.
Description	This field displays the description of the item.
Item#	This field captures the unique identifier for the item.
Price	This field displays the unit price for the item.
Qty	This is the quantity of the item added on the invoice.
Returnable?	This flag lets you know whether an item is returnable or not.
Return Code	This displays the item return code of the item that you are adding.
Return Note	Add any return notes for the item here. Typically these are notes about the item (damaged, missing parts, etc.).
Tax	This is the tax code of the item you are adding.
Type	Specifies the type of item, such as inventory, non-inventory, etc.
Uom	Specifies the unit of measure for the item (liter, unit, kilogram, etc.).
VAS Item	This is an editable input field that indicates whether the item has a VAS (Value-Added Service) item applied to it or not.
VAS Item Cost	Displays the unit cost for the Value-Added Service item.
VAS Item Total Cost	Displays the total cost for the Value-Added Service item.
Return Income Account	This allows users to specify the return income account for each line item individually.

Click on the "Add Qty" button under the Credit Qty column, and in the "Add/Change Credit Memo Qty", select the qty to Credit back into stock.

After adding the item(s), click on "Save" button to create the invoice credit memo. The system will automatically assign a unique number to the invoice credit memo in the format of CM-C000001, where "CM" denotes the sales store code and 1 denotes a sequential series. This number will be displayed on the top left corner of the page. Once this number is generated, it becomes a permanent identifier and cannot be altered.

Creating Invoice Credit Memo manually

An invoice credit memo can be created manually from the module. To create the invoice credit memo, you'll begin by searching and selecting the invoice and adding the invoice item lines to credit. Then, you will proceed by entering the basic information, such as the return type, return date, return account and return inventory store.

To create an invoice credit memo, go to Menu > Sales > Credit & Deposit > Invoice Credit Memo

Invoice Credit Memo Header Fields

Section	Field	Description
Main	Invoice	This field allows you to search for and select a specific invoice to which the invoice credit memo will be applied. After selecting the invoice, users will be prompted to select the item and item quantities to add to the invoice credit memo.
Main	Return Type	This field lets you choose among 2 types of RMA processes for the returned goods. “Direct” will ask you for a location when you add an item, so you will have to put away the item immediately. “Warehouse” will give you the option of generating an ASN for putting away the goods into the warehouse at a later time. Choose the option which best suits your warehousing workflow.
Main	Customer	Type a Name, Phone number, or email here to select a Customer for the Credit Memo. Click on icon for more details on the selected Customer.
Main	Select Account	This fields allows you to select the account from which the credit amount will be credited.
Main	Date	The date on which the invoice credit memo was created or initiated is captured in this field.
Main	Ref No	This field allows you to assign a unique reference number or identifier to the invoice credit memo for easy tracking and reference purposes.
Main	Project/Class	This field allows you to select a project or class to associate this credit memo.
Main	Return Inventory Store	This field allows users to specify the store or location where the returned inventory will be processed and recorded.
Main	Third Party Notes	This field displays the third-party notes for the orders created using an integration like Shopify, etc.
Discount Returns	Discount Available	If a discount has been applied to the invoice, this field displays the discount amount that is available to be applied to the invoice credit memo.
Discount Returns	Discount Amount	This field allows you to select the discount amount to be applied to the invoice credit memo.
Discount Returns	Discount Account	This field allows you to select the account where the discount will be recorded.
Shipping Returns	Shipping Method	This field displays the shipping method used for shipping the sales order associated with the invoice.
Shipping Returns	Shipping Term	This field specifies agreed-upon terms of shipping of the sales order associated with the invoice.
Shipping Returns	Tax Code	This field specifies the tax applied on the sales order associated with the invoice.
Shipping Returns	Shipping Available	This field displays the shipping amount as recorded on the invoice.
Shipping Returns	Shipping Amount	This field allows users to enter the shipping amount to be credited to the customer.
Shipping Returns	Shipping Expense Account	This field allows you to select the account where the shipping amount will be recorded.
Inventory Log	Inventory Log	This tab shows the detailed log of the inventory movements or changes associated with the invoice credit memo.
Custom Fields	Custom Fields	This tab allows you to select the custom fields associated with credit memo transaction type.
Footer	Ship To Address	The "Ship Address" field shows the shipping address for the invoice credit memo. When a customer is selected, this field is automatically filled with the corresponding shipping address. You can choose other addresses from the drop-down menu or edit the address by clicking on it
Footer	Memo	The "Memo" field provides space for writing notes or any additional information related to the invoice credit memo.
Footer	Exchange Rate	If the invoice credit memo is for a foreign customer, the "Exchange Rate" field allows you to specify the conversion rate for currency exchange.

Adding Item(s) to the Invoice Credit Memo

Once the Invoice Number is selected at the header level, users are prompted to select specific invoice lines to credit.

• Selecting Invoice Lines to Credit:

  • A "Select Invoice Lines to Credit" pop-up appears, displaying all items listed on the selected invoice.
  • Users can click the "Add Qty" button under the "Credit Qty" column for the item they wish to credit.

• Specifying Return Details:

  • Enter the number of units to return under Credit Qty.

  • Specify the Location from where the return will be processed.

  • Optionally, users can provide a Return Code and a Return Note to describe the reason for the return or provide additional context.

After entering the required details, press "Close" to add the selected item(s) to the invoice credit memo.

Adding Additional Lines

If not all items are initially selected, users can easily add more lines to the credit memo later. In the Credit Memo Details section, click on the "Add Lines" option. This allows users to select and credit additional invoice lines without restarting the process, ensuring flexibility in managing item returns.

Invoice Credit Memo Details Fields

Field	Description
Item#	This field displays the unique identifier for the item being returned.
Item Type	This field indicates the classification of the item.
Description	This field shows the description of the item being returned.
Unit Cost	This field displays the unit cost of the item.
Re-stocking Fee	This field records the fee charged for re-stocking the returned item.
Qty	This field shows the quantity of the item being returned.
Uom	This field shows the unit of measurement associated with the item.
Tax	This field specifies the applicable tax rate for the item being credited.
Tax Amount	This field shows the calculated tax value based on the item's taxable amount.
EUP	This field represents the total price of the item before tax, calculated as unit cost multiplied by quantity.
Amount	This field indicates the total amount to be credited for the item, including tax.
RCode	This field specifies the reason code for the return, which categorizes the return or adjustment.
Return Note	This field displays any additional notes or comments regarding the return.
Project/Class	This field shows the project/class associated with the item.
Uom Factor	This field represents the conversion factor between the base unit of measurement and the selected unit of measurement for the item.
VAS Item	This field shows any Value-Added Service (VAS) item associated with the returned item.
VAS Item Cost	This field shows the cost of the VAS item.
VAS Item Total Cost	This field displays the the total cost of the value-added services, calculated based on the quantity.
Income Return Account	This is an editable field that displays the account where the credited amount for the item is recorded.
Custom Fields	These fields show the custom field defined for the credit memo.

After adding the item(s), click on "Save" button to create the invoice credit memo. The system will automatically assign a unique number to the invoice credit memo in the format of CM-C000001, where "CM" denotes the sales store code and 1 denotes a sequential series. This number will be displayed on the top left corner of the page. Once this number is generated, it becomes a permanent identifier and cannot be altered.