If you convert a sales invoice with any type of schedule into a credit note, you will produce a single credit note for the full invoice value, but with no schedule.
If you want to credit only part of the original invoice value, you must either amend the credit note or create a new credit note from scratch. There is no reference to, or reversing of, the schedule on the original invoice.
Income schedules
If you credit a sales invoice with an income schedule, the schedule is not canceled automatically. The transaction created when the credit note is posted will credit the accounts receivable control account and debit the sales revenue account defined on the product.
You have the following options:
- Convert the sales invoice into a credit note. Then, manually create and post the appropriate canceling or manual journals to make the required adjustments.
- Create an equal but opposite sales invoice (with negative line and income schedule values). Then, match the two invoices together.
Remember, in the second option the adjustment document will not appear in any sales credit note reports. It will appear in sales invoice reports.
Manual Adjustment Example
Sales invoice with number of income schedule journals set to 12:
Debit – accounts receivable control 120.00
Credit – deferred revenue 120.00
Convert to sales credit note:
Credit – accounts receivable control 120.00
Debit – sales revenue 120.00
12 journals created for income schedule:
Debit – deferred revenue 10.00
Credit – sales revenue 10.00
Cancel all 12 journals that were created:
Credit – deferred revenue 10.00
Debit – sales revenue 10.00
After this is done, you are left with a credit to the deferred income account and a debit to sales revenue account, so you must post a final manual journal to correct this:
Journal:
Debit – deferred revenue 120.00
Credit – sales revenue 120.00
SECTIONS