Debit Note

A Debit Note is a document sent by a buyer to the Supplier notifying that a debit has been recorded against the goods returned to the Supplier.

A Debit Note is issued for the value of the goods returned. In some cases, sellers are seen sending Debit Notes which should be treated as like another invoice.

A Debit is for your record of the debit against the Items your return.

How to create Debit Note

The user can make a Debit Note against the Purchase Invoice or they can directly make Debit Note from the Purchase Invoice without reference.

Go to the respective Purchase Invoice and click on Create > Return / Debit Note.



The Supplier and Item details will be fetched as set in the Purchase Invoice.
If you had paid partially or fully, make a Payment Entry against the original Purchase Invoice.
Save and Submit.



The other steps are similar to a Purchase Invoice.

How does Debit Note affect ledger?

Once a Payment Entry is created against the original Purchase Invoice, the amount will be added to the Supplier's account in negative so that the next time you make a purchase, this amount will be adjusted.

This is how the ledger is affected after a payment entry against a returned invoice:



No payment was made against Sales Invoice

In case no payment was made against the original invoice, you could just cancel the Sales Invoice. But, if only 5 out of 10 Items are being returned from an invoice, creating a Debit Note is useful for updating the ledger.

Example

From Supplier Blue Mills, you had purchased Cotton worth Rs. 2400 + taxes and at the time of delivery, you found that the products were damaged. Now you returned the product a Debit Note will be issued.

Debit Note with payment entry in OneHash for above example is as below:

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