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Debit notes ; Some businesses use debit notes to bill for items that are not related to their primary business. E.g. a wholesaler sublets a part of its warehouse and uses a debit note to charge rent instead of the actual invoice used for sale of goods. They are also used to make adjustments in incorrect invoices in a case where the purchaser was undercharged.
Credit notes are also used by sellers to correct invoices which have been overcharged to the buyer and they also can be issued by a seller as a goodwill gesture to a buyer who wishes to return previously purchased merchandise (instead of cash repayment) in circumstances where the original sales agreement did not include an explicit refund policy for returned items.
Debit note is a document sent by a customer to a supplier in respect of goods returned or an overpayments made. It is a formal request for the supplier to issue a credit note.
Credit note is document sent by a supplier to a customer in respect of goods returned or overpayments made. by the customer. it is a negative invoice.
I fully agree with the answers been added by EXPERTS..............Thanks.
f agree with the answer given by frank mwansa ACCOUNTING LECTURER.
I agree with Mr. David and Frank.............
1. A transaction that reduces Amounts Receivable from a customer is a credit memo. For e.g.. The customer could return damaged goods. A debit memo is a transaction that reduces Amounts Payable to a vendor because, you send damaged goods back to your vendor.
2. Credit memo request is a sales document used in complaints processing to request a credit memo for a customer. If the price calculated for the customer is too high, for example, because the wrong scale prices were used or a discount was forgotten, you can create a credit memo request. The credit memo request is blocked for further processing so that it can be checked. If the request is approved, you can remove the block. The system uses the credit memo request to create a credit memo.
You can use credit memos in Sales and Distribution (SD) for assigning credit memo requests to the open invoices and in Financial Accounting (FI) for assigning credit memos and payments to the open invoices and carry out clearing with them. If you use both Financial Accounting (FI) and Sales and Distribution (SD), there is a 1:1 relationship between the credit memo request and the credit memo item posted in Financial Accounting (FI). As soon as you bill the credit memo request together with other sales orders, or distribute the items of one credit memo request to several billing documents, the assignment is no longer valid and the system will not process it.
For credit memos, credit memo requests, and payments, you have the following assignment options: - Assignment to a single invoice - Assignment of a partial amount to an invoice - Assignment to several invoices
When you post credit memos, the payment programme processes them automatically. If the credit memo is specifically related to a particular open invoice item, the payment program automatically attempts to offset the credit memo against the open item. If it is not possible to completely offset the credit memo against an invoice, you can post a debit memo to the vendor, who is to reimburse the amount. Then you can apply a multilevel dunning program.
3. Debit memo request is a sales document used in complaints processing to request a debit memo for a customer. If the prices calculated for the customer were too low, for example, calculated with the wrong scaled prices, you can create a debit memo request. The debit memo request can be blocked so that it can be checked. When it has been approved, you can remove the block. It is like a standard order. The system uses the debit memo request to create a debit memo.
4. As mentioned above, creating a credit or debit memo request enables you to create credit or debit memos based on a complaint. For this first create a sales document with the order type for a credit or debit memo request. You can create the debit or credit memo requests in the following ways: – Without reference to an order – With reference to an existing order Here you enter which order the complaint refers to. – With reference to an invoice Here you enter which invoice the complaint refers to. In all cases, you specify the value or quantity that should be in the credit or debit memo
5. You can block the credit or debit memo request from being billed in Customizing. Go to Sales -> Sales Documents -> Sales document header -> Define sales document type and select the billing block field in the billing section. This request can later be reviewed along with similar ones, - if necessary, by another department. The request for a credit or debit memo can then be approved or rejected.
simply expenses and income. thanks.
I apologize that you did not understand the question
Agreed with Mr. David and Mr. Frank.
