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in this lesson were going to learn about credit memos and what they are used for in esc credit memos are used to give refunds to customers back out and correct invoices and clear bad debt you can create a credit memo right from a sales invoice or by selecting enter credit memos from the sales drop down menu lets start out by issuing a refund to a customer a credit memo can be used to issue a full refund on an invoice or a partial refund we simply select the invoice we are going to issue a refund for from the sales invoicing screen now go to the activities menu and select create credit memo notice that all of the information from the invoicing screen was pulled over into the credit memo including the line items youll also notice that this screen is almost identical to the sales invoicing screen this is because both are created and built the same way but whereas the invoice increases your accounts receivable a credit memo reduces it if you only want to issue a partial refund simply re