Credit Note

Implementation Updated by Implementation

What is Credit Note?

A credit note or credit memo is a commercial document issued by a seller to a buyer. Credit notes act as a source document for the sales return journal. In other words the credit note is evidence of the reduction in sales.

Overview

This document is generally used to cut the cost of goods and services sold to customer. Sometime user sends sale invoice high price than contracted price. In this case user can send a credit note to reduce the cost.

But in case, if user has to pay extra amount to vendor then user can send credit note to vendor too.

Use Case

Suppose there is firm “XYZ Ltd”. This is manufacturing firm and they sent an Invoice with rate of Rs200/- per piece but that contracted rate is 195. So in that case user has to issue a credit note for the difference of Rs. 5/-.

With this option, they can post the entry for credit note with tax and without tax.

Steps to be performed to create Credit Note

1.User can open Credit Note from Account Receivable & Account Payable. Click on Credit Note.

2.i)Enter posting date ii)Select Ledger account as per double entry accounting standard and enter the amount. iii)Enter narration and remarks if required. iv)Click on save & continue after that simulation will open.

2.1.In simulation: Click on save.

3.After saving Document, If user want to print the document then click on “Yes Print it”.

3.1.Print

4.Credit Note with Tax-> User can enter Credit Note with tax booking. Select Tax Customer or Tax Vendor for tax booking.

4.1.After selection of Tax Customer, it will change the User Interface of page i)User will enter posting date and select customer ii)Select Ledger account and enter amount. Save the document.

4.2.User need to follow same process in case of Vendor. Just select vendor and rest procedure will remain same.

4.3:After saving document user can take print by click on “Yes Print It”.

4.4.Print

5.Print Layout: Go to Account Receivable-> Settings-> Click on Invoice Format

5.1.Set Print layout in Debit note as GST Print

6.If user want to select tax at the time of posting entry then user has to activate setting for “Manual Tax”. Go to Ledger-> Apps-> Click on Voucher Settings-> Activate Manual Tax.

6.1.User need to select Tax given after ledger account

6.2.User can see in below screen shot that tax has been applied.

7.User can save bulk entries with the help of CSV. Go in Credit Note and click on Import option (marked in below screen shot). The pop up will open and user can download the sample file.

7.1.IN CSV: User will start entering data from 3rd row because 2nd row is reserved for sample data and that will not be saved in system as transaction.

a)Normal Credit Note entry: i)Enter serial number 1 for 1 entry. Like there are 3 ledgers will be used for 1 entry then serial number will be same for all ledgers. Serial number will become 2 only with start of second entry. ii) Under document type user can enter document code of all document. CN is the code of Credit Note iii) Enter Posting date & document date iv) Enter currency code v) Enter Posting Key vi) Enter Type of Account i.e. Customer, Vendor or GL in form of V/C/GL vii) Account id viii) Enter Amount.

b)Credit Note with Tax: i)Enter serial number 1 for 1 entry. Like there are 3 ledgers will be used for 1 entry then serial number will be same for all ledgers. Serial number will become 2 only with start of second entry. ii) Under document type user can enter document code of all document. CN is the code of Credit Note iii) Enter Posting date & document date iv) Enter currency code v)In IS GST: enter X in Vendor/Customer row vi) Enter Posting Key vii) Enter Type of Account i.e. Customer, Vendor or GL in form of V/C/GL viii) Account id ix) Enter Amount.

7.2.Upload this csv and save the document

8-i)Entry posted without tax in Credit note will appear only in Vendor & Customer Ledger and Ledger.

  ii)Entry posted with tax and Vendor will appear only in Vendor Ledger, Ledger and GSTR3b.

iii)Entry posted with tax and Customer will appear in Customer, Ledger, Ledger, Sale Register, GSTR1 and GSTR3b. Please see related help docs for detailed information.

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