2. On the Sales Order, click Fulfill. If you are using the Pick, Pack & Ship feature, mark the item as Shipped then save the Item Fulfillment.
2. Back on the Sales Order, click the Return Authorization/Authorize Return button.
3. In the New Return Authorization page, change the Quantity from 5 to 2 with Status 'Pending Approval' the save it.
4. While in the saved Return Authorization page in view mode, click 'Cancel Return' button. The Return Authorization Status is now Cancelled.
5. Go back to the associated Sales Order, click again the Return Authorization button. The new Return Authorization Quantity is 3.
Defect 192509 was logged to report this behavior. The alternate solution is to either Delete the first Return Authorization or override the Quantity in the new Return Authorization before hitting the Save button.