Debit note

A debit note or debit memorandum (or debit memo) is a commercial document, common in business to business (B2B) transactions, that either buyers or sellers may use regarding the amount due for a sale of goods or services. 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. The seller might also issue a debit note instead of an invoice in order to adjust upwards the amount of an invoice already issued (as if the invoice is recorded in wrong value). Debit notes are generally used in business-to-business transactions. Such transactions often involve an extension of credit, meaning that a vendor would send a shipment of goods to a company before the goods have been paid for. Although real goods are changing hands, until an actual invoice is issued, real money is not. Rather, debits and credits are being logged in an accounting system to keep track of inventories shipped and payment. When a price is included on a debit note, it is the price which the customer was actually charged for those goods.

This article needs additional citations for verification. Please help improve this article by adding citations to reliable sources. Unsourced material may be challenged and removed.
Find sources: "Debit note" – news · newspapers · books · scholar · JSTOR (March 2018) (Learn how and when to remove this message)

Accounting
Part of a series on

Constant purchasing power Historical cost Management Tax
Major types Audit Budget Cost Forensic Financial Fund Governmental Management Social Tax
Key concepts Accounting period Accrual Constant purchasing power Economic entity Fair value Going concern Historical cost Matching principle Materiality Revenue recognition Unit of account
Selected accounts Assets Cash Cost of goods sold Depreciation / Amortization (business) Equity Expenses Goodwill Liabilities Profit Revenue
Accounting standards Generally-accepted principles Generally-accepted auditing standards Convergence International Financial Reporting Standards International Standards on Auditing Management Accounting Principles
Financial statements Annual report Balance sheet Cash-flow Equity Income Management discussion Financial statement analysis
Bookkeeping Bank reconciliation Debits and credits Double-entry system FIFO and LIFO Journal Ledger / General ledger Trial balance
Auditing Financial Internal Firms Report Sarbanes–Oxley Act
People and organizations Accountants Accounting organizations Luca Pacioli
Development History Research Positive accounting Sarbanes–Oxley Act
Misconduct Creative Earnings management Error account Hollywood Off-balance-sheet Two sets of books
v t e

A debit note or debit memorandum (or debit memo) is a commercial document, common in business to business (B2B) transactions, that either buyers or sellers may use regarding the amount due for a sale of goods or services. ^[1] Debit note acts as the Source document to the Purchase returns journal.^[2] In other words it is an evidence for the occurrence of a reduction in expenses. The seller might also issue a debit note instead of an invoice in order to adjust upwards the amount of an invoice already issued (as if the invoice is recorded in wrong value). ^[3]

Debit notes are generally used in business-to-business transactions. Such transactions often involve an extension of credit, meaning that a vendor would send a shipment of goods to a company before the goods have been paid for. Although real goods are changing hands, until an actual invoice is issued, real money is not. Rather, debits and credits are being logged in an accounting system to keep track of inventories shipped and payment.^[4]

When a price is included on a debit note, it is the price which the customer was actually charged for those goods.

References

[edit]

^ Investopedia Staff (2011-06-07). "Debit Note". Investopedia. Retrieved 2017-09-15.
^ "How to Create a Debit Note in QuickBooks?". Retrieved 2021-05-02.
^ "What is a Debit Note?". Retrieved 2021-05-02.
^ "What is the Difference Between Debit Note and Credit Note?". Archived from the original on February 2, 2023. Retrieved 2021-05-02.