Using Credit Note or Credit Memo

Note: The support for credit note or credit memo is available only in the Pro and Enterprise editions of Excel Invoice Manager. For more information about the difference between editions, please see The Difference between Excel Invoice Manager Editions.

What Is Credit Note or Credit Memo
When to Use Credit Notes or Credit Memos
Using Credit Note or Credit Memo in Excel Invoice Manager
Creating a Separate Template for Credit Note or Credit Memo
Upgrading from Previous Versions

What Is Credit Note or Credit Memo

A Credit Note is a commercial document issued by a seller to a buyer, listing the products, quantities and agreed prices for products or services the seller provided the buyer, but the buyer did not receive or returned. It may be issued in the case of damaged goods, errors or allowances.

In respect of the previously issued invoice, a credit note will reduce or eliminate the amount the buyer has to pay. In other words, a credit note reduces Amounts Receivable (i.e. customer account balance) in Excel Invoice Manager. You can think of a credit note as a "negative invoice".

Credit notes are often called credit memos (short for "credit memorandum"), or just Credits.

When to Use Credit Notes or Credit Memos

The following examples cover some of the times when credit notes are used.

• Goods returned. This is probably the most common reason for creating a credit note. Goods are returned for a number of reasons - wrong color or specification, your customer no longer requires them, faulty goods, incorrect goods supplied etc. When creating the credit note, specify exact the same Product ID and a negative Quantity to return the goods to the inventory.
• Goods short delivered. For example, a loss of goods by carrier, an error during packaging or lack of stock. If you have invoiced your customer for 10 units and they only receive 9; the customer then calls you to say that 9 units are okay and does not want the shortfall item at the moment. Therefore you need to issue a credit note to credit your customer for the shortfall quantity of 1 unit.
• Under payments is another common reason for creating a credit note. If you create an invoice for $10000.13 - the customer may misread the amount and send you payment for $10000.00. You can either carry the remaining 13 cents over into the customer's balance and leave the invoice pending - which will be visible on statements of account, or you may wish to write-off the short payments by creating a credit note for $0.13.
• To apply discounts after shipment. You sent an invoice for $2050. The customer then calls you asking for a discount to make the net invoice amount $2000. You agree to this and then issue a credit note for $50.
• And so on...

Using Credit Note or Credit Memo in Excel Invoice Manager

In Excel Invoice Manager you create a credit note or credit memo in a simple and similar way like what you do for sales invoice. The only exception is that for a credit note, you enter a negative quantity or negative price to make the Total and Total Balance negative - If the total is less than zero, Excel Invoice Manager accepts it as a credit note, and add the amount of the Total Due to the Credit field of the customer account.

1. Click Clear & New to clear the Invoice worksheet.

   Tip: If the new credit note is similar to an invoice you created, You can load and edit the invoice to create the new credit note:

   • Click the Invoices button to list all the invoices.
   • Locate and select the invoice in question.
   • Click the Edit In Excel button to display it in the Invoice worksheet.
   • Clear the Invoice Date and Invoice ID fields.
2. Enter the items on the invoice body. Make sure the Quantity or Price is negative, to make the Total and Total Due fields of the invoice negative.

   If you need to return goods to inventory or stock, make sure the Product ID is correct and the Quantity is negative.

3. Click the Save To DB button to save the credit note.

After saving a credit note, the Customers data list window shows the credit in the Credit column. This column is invisible by default. To display it in the Pro and Enterprise editions of Excel Invoice Manager, right-click the data list area and then check Credit on the menu.

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Note: A credit note is marked as paid automatically when you click Save To DB. You cannot edit a credit note except its notes field. However you can delete or void a credit note.

Note: By default credit notes share the same ID prefix and the same group of auto-generated serial numbers with invoices. For example, if the last invoice you saved was INV1001, the credit note immediately after the invoice would be INV1002. However, you can use your own IDs by enter the ID manually into the Invoice # cell before clicking Save To DB.

To apply the available credit to an invoice:

1. Click the Invoices button on the Invoice worksheet to open the Invoices data list window.
2. Double-click the invoice to which you want to apply the credit.
3. Go to Payments tab.

   
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4. If the customer account has a non-zero credit available, the Apply Credit button is enabled. Click it to open the Applying Account Credit dialog box.

   
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5. Enter the amount of credit you want to post to the current invoice, and then click OK.
6. The applied credit appears as a payment record, with a payment type of ACCOUNT CREDIT. A payment with the type of ACCOUNT CREDIT is not editable, but can be deleted.

   
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Creating a Separate Template for Credit Note or Credit Memo

You may like to create a special template for credit notes, instead of using the invoice template. For example, you may like to use the words "Credit Note" to be clearly written towards the top of the page, or you may like to remove some unneeded cells like Ship Date, Ship Via, Terms, Due Date. This is possible, and in fact, is easy to do.

1. Exit Excel it is running.
2. Copy your invoice template. Name the new file Credit-Invoice.xls or something else you like.
3. Open Credit-Invoice.xls.
4. Unprotect the Invoice worksheet. (How?)
5. Switch to design mode. (How?)
6. Click the cell where it says "INVOICE" - in the standard template, the cell is N3. Enter the label you want, say "Credit Note".

   
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7. Modify the other labels as you like.
8. Drag your mouse to select the area you want to remove
9. Click the border of the selected area; drag it to place it outside the Print_Area.
10. Click the unneeded icon button; drag it to place it outside the Print_Area.
11. Once finished, exit design mode.
12. Protect the Invoice worksheet.

Click the following links to download the sample credit note template:

• Credit-Note.zip
• Credit-Note.xls

Upgrading from Previous Versions

If you install the latest version of Excel Invoice Manager on a computer where a previous version (2.8.1012 or earlier) has already been installed, the setup program executes an upgrade process - During this process all the program files (for example, *.dll, *.ocx files) are replaced with the latest versions, but you can choose to use your existing data file.

The support for credit note/credit memo does introduce new requirements for the data files - that is, it requires a new field Credit to be added to both the database file and database definition file. To fulfill the requirements, Excel Invoice Manager upgrades your existing data files automatically when you use the data files first time with the new version of program. In most cases the upgrade is silent and automated - you may even not be aware of that there is an upgrade process to the data files.

However there is still the possibility that the data file upgrade process fails and you need to do something before you can use the existing data files with the new program.

Failed to Modify the Database File

In this situation Excel Invoice Manager displays an error message like this:

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This problem occurs if the database file is read-only or locked by the other users on the network.

If the database file is read-only, simply make the file writable by uncheck the read-only attribute of the file in Windows Explorer.

Within a network environment, the problem occurs when there are other computers running the earlier version of Excel Invoice Manager, and at the same time you try to run the new version of Excel Invoice Manager from another computer. To resolve problem:

1. Exit Microsoft Excel on all the other computers.
2. Start the new version of Excel Invoice Manager from one of the computers.
3. Upgrade to the new version of Excel Invoice Manager on all of the computers.

Failed to Modify the Database Definition File

If the following error message appears:

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It is likely that the database definition file is read-only. Please make it writable. Within a network environment, make sure the database definition file is stored in the same folder as the database file.

TIP: Need more information about credit note or credit memo? See credit note on wikipedia.org.