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There are various ways to compensate a customer who is dissatisfied with an order. The terms of a compensation agreement reached between the company and the customer will often depend on the stated reason for return and the company-customer relationship. For instance, the parties may agree that in case of a wrongly ordered item, the customer returns the item to the company against a credit, receives a replacement item and accepts that the company charges a certain restock fee. In other situations, for example, where an item arrives at the customer slightly damaged, the customer may agree to receive a price deduction against the original sales order price. Meanwhile, where the sold item has a warranty, the company may suggest the customer take the malfunctioning or broken item in for repair.
The sales return order is the central document that allows the user to register a compensation agreement settled with a customer. From here, the user can access other sales-related documents, and enter and maintain the return-related information concerning the customer, the method of compensation, and the items in question.
Sales Returns are used to compensate your customers for incorrect or damaged items. See About Returns Management for more information.
The following are the standard steps in processing a basic sales return order. A basic return order is created when you simply want to credit your customer for a returned item. Additional return options are described below.
On the Invoicing tab, you can apply the return order to the associated sales invoice by filling in the Applies-to Doc. Type and Applies-to Doc. No. fields.
By receiving and invoicing the return order, a posted sales credit memo is created.
If the associated invoice was not applied earlier in the process, this application can take place after posting.
The following options can be used in conjunction with basic processing steps outlined above.
In some cases, you may decide to charge a restock fee to cover the physical handling costs of returning an item.
If you want to revalue the returned item using the unit cost that is connected to the original sales entry, assign Exact Cost Reversing.
You may agree to compensate your customer for an item that you sold them by giving them a deduction against the original sales order price by creating a sales allowance.
You may agree to replace an item that you have sold your customer by creating a replacement sales order. The replacement item can be the same or it can be different.
In some cases, your customer may want to return a specific serialized item or lot. For instance, a particular item or lot is defective or damaged during shipment. For these situations, the program allows you to find the item using the serial or lot number and then receive that specific item or lot return.
Locate the serial/lot numbers sold to the customer.
Select the line that you want to select serial/lot numbers for.
Click the Line button and then select Item Tracking Lines.
In the Item Tracking Lines
window, click the AssistButton 
in the Lot No. or Serial No. field to select from the
Item
Tracking Summary window.
You can create all return-related documents at the same time from the Sales Return Order window. Alternatively, you can create all the documents individually.
For items that have been received but not yet invoiced:
There may be times when your customer returns several items that are covered by different sales return orders. Once the items have been received and before you invoice, you can use the Get Return Receipt Lines function to create one sales credit memo for all of the received items.
If a return order has been received but the item is subsequently rejected, you must create a corrective sales invoice to complete the return order transaction.