Difference Between Credit Memo and Refund Memo.– Since a CM worth $1000 has been applied to it, you see that activity against Credits entry.ĥ.Credit Memo – Definition, Format, Scenarios and Example Invoice and what is the balance at the end of the day. – Click on Details button in Balance Due section which will give you a detailed activity happened against the Since CM has been applied, the balance of the invoice is $4000. – Enter Apply To as 501005 which is the Invoice number that you want to apply this CM to. – From the menu select Actions > Applications – Query the CM (501006) that you want to apply: – Navigation: Receivables resp > Transactions > Transactions – Complete the transaction by clicking the Complete button on the Transaction window. – Click on Line Items button to create the CM line.Īmount : -1000 as this is the refund that we giving to the customer for returning the item. Payment Details: Enter the Bank Account details Type: Appropriate transaction type for Credit Memoīill To: Customer Name for whom this Credit Memo is being created What GL Accounts to use will be decided by the Transaction Type setup. – Distributions are automatically created. Only if the transaction is Complete, further actions can be done on it. ![]() – Complete the transaction by clicking the Complete button. – Enter the Item, quantity and the unit price of the item and save the work. – Click Line Items button to enter the invoice line details – Once the above fields are entered, save the work. Payment Details: The bank details you are expecting the customer to deposit the amount to.Enter the details and click on Apply. Payment Term: When the invoice is due meaning by when the customer is expected to pay the amount on the transaction. GL Date: Date that should be used when this transaction is being transferred to GLīill to: Enter the Customer name to whom the invoice has to be raised.Ĭurrency: Currency that is being used to report the amount in Legal Entity: Give the name of the Legal Entity for which this transaction has to be created in Reference: Holds the Sales Order number if it has been imported from Sales Order Whether positive mount or negative amount can be entered while creating the transaction.For what kind of transactions this information should be defaulted.GL Accounts for Receivables ,Revenue and other account classes that are required for accounting.Type: Transaction Type is another setup screen that lets you default some of the attributes like the below when you are creating a transaction: If automatic numbering is enabled in Source setup, the number will be generated automatically else will have to enter the number manually. Number: A unique identifier for the transaction created. Which Transaction Class can use this SourceĬlass: What type of transaction you want create.If the Reference field in Transaction window should hold the Sales Order number (if it has been imported from Sales Order).Navigation: Setup> Transactions > Sources Source: Lets you to identify the source of the invoice meaning whether invoice is created manually or has been imported. – Description of some important field in Transaction window: – Navigation: Receivables Responsibility > Transactions > Transactions Check the balance on the Invoice (should decrease).We again send the credit Memo note to the customer to let them know that they have to pay us only $4000. In such a situation, we create a credit memo of $1000 and apply to the invoice of $5000 to bring down its balance to $4000. We have already issued an invoice of $5000 but now we are supposed to charge them only $4000 because of the refund of $1000 for the defective piece. Later upon receiving the goods, customer realized one of them worth $1000 is defective and had to return it. Say you have created an invoice of $5000 for a customer ABC and have sent it across. Invoice: A document that will convey how much the customer has to pay for the goods and services he has bought and due date for paying the amount.Ĭredit Memo: Negative amount to decrease the balance of the invoice.īalance of Invoice: The amount that the customer has to pay.Įxample of scenario in which a Credit Memo is created:
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