It's better to do a credit memo. Lists are so much easier to follow than paragraph so here you go:

1. Go back into the service job the original purchase was applied to.
2. Change the status to WPK
3. Make a note explaining why the credit is being granted (i.e. merchandise return) and reference the previous sales ticket and invoice #'s.
4. Enter a transaction for the item(s) being returned as a positive quantity and $ amount
5. Go into invoice creation and answer yes to the questions that asks if you want to continue even though the service job has been billed previously
6. Change the invoice type to "credit memo"
7. Make sure to select the invoice to apply the credit memo to
8. Bring the transaction(s) over to the credit memo
9. Add the notes that you entered into the service job
10. Double check to make sure the totals on the return receipt and the credit memo match. Please keep in mind that even though it is a credit memo that the amount will be positive prior to your printing the credit memo at which point it will then change to a negative.
11. Print the credit memo and update the batch

IN CASH RECEIPTS ENTRY:
1. Select "cash receipts entry"
2. Create a new batch
3. Enter the total amount for the batch (as a negative amount if the credit memo item is the only thing that will be in the batch)
4. Create an entry - select the customer ID number (make sure you check the printed credit memo for this information so that you credit the right customer account)
5. Enter the reference #
6. Enter the amount as a negative amount
7. Click on "auto" and the module should automatically select the credit memo that you created
8. Make a note in the comments box such as merchandise return or credit memo
9. Click on "accept"
10. Preview the cash receipts journal before printing
11. Print if okay and then update
12. Check the customer's account to make sure it reflects a $0 balance