Debit Note

Implementation Updated by Implementation

What is Debit Note?

A debit note is a commercial document issued by a buyer to a seller as a means of formally requesting a credit note. Debit note acts as the Source document to the Purchase returns journal. In other words it is an evidence for the occurrence of a reduction in expenses.

Overview

This document is generally used to cut the cost of goods and services against the invoice sent by seller. Sometime seller prints the Sale Invoice with higher rate than actual rate. In that case purchaser issues debit note to seller for difference amount instead of making payment of whole amount.

But some time user send the sale invoice to his purchaser on a lower rate in that user has to issue a debit to his customer also and it is referred as addition in income.

Use Case

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

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

Steps to be performed to create Debit Note

1.User can open Debit Note from Account Receivable & Account Payable. Click on Debit 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.Debit Note with Tax-> User can enter Debit Note with tax booking. Select Tax Vendor or Tax Customer for tax booking.

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

4.2.User need to follow same process in case of customer. Just select customer 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 Debit 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 Debit 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. DN is the code of Debit 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)Debit 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. DN is the code of Debit 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 Debit 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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