Recording a Credit Memo

A credit memo is note issued by a vendor in place of a cash refund for unfilled or returned orders that can be applied to other invoices from the vendor. You record credit memos with the New Credit Memo option on the Statement menu. This option creates a statement header with a type of “Credit Memo.” This type lets you add credit memo, invoice, and supplemental lines to the statement.

If you receive a statement that includes both invoice and credit lines, but the net balance means you owe the vendor, record the statement as an invoice, instead of a credit memo. You can add credit lines to a statement header with a type of “Invoice.” (For instructions on recording a regular invoice, see Recording an Invoice.)

Horizon keeps track of the credits you receive from a vendor. After you record a credit memo, you can apply the credit to another statement from the vendor. (For information about applying credits, see Applying Credits.)

Entering Credit Memo Amounts as a Positive or Negative Number

The amounts you enter for a credit memo in the statement header and lines are automatically changed to negative amounts if you enter them as positive numbers. However, Horizon does not automatically change extra charge amounts to negative amounts. You can enter these amounts either as a positive or negative number, depending on whether you are being credited or charged. If you are entering a credit for an extra charge, be sure to enter the amount as a negative number.

To record a credit memo

1 Start the New Credit Memo process.

The default location of this process is the Acquisitions\Statement folder on the navigation bar.

Horizon displays the Compound Search window.

2 Search for the vendor whose statement you are recording.

After you choose the vendor, Horizon displays the Edit Statement (new) Header window:

3 Complete the fields in the window. (For a description of each field, see Edit Statement Header Window.)

The “Credit Memo” statement header does not include the Checks group, since this group does not apply to credit memos.

Note: If you are entering a credit for an extra charge, be sure to enter the amount as a negative number. Unlike other amounts on the credit memo, Horizon does not automatically change extra charge amounts to negative numbers.

4 Save the file.

Horizon displays the Statement window:

This window lets you add the lines that are included on the vendor statement.

5 To add a line type other than “Credit Memo,” choose Statement, Change Mode and mark the type that corresponds to the line you are adding.

For example, if you are recording a statement that includes a regular invoice line, you can change the mode to “Invoice.” The line types that you can add depend on the header type. (For more information, see Mixing Line Types.)

Note: The rest of the steps in this task assume you are recording credit lines. For instructions on recording lines of other types, see the task that corresponds to the type of line you are recording.

6 Click Candidates to search for the PO lines.

Horizon displays the Find Candidate Lines window.

7 Do one of these steps:
Mark Search to search for the lines.
Mark Vendor to display all PO lines for the vendor that have been invoiced.

Horizon displays the PO lines that match your search criteria and that have already been invoiced. Only those lines you actually highlight for inclusion on the statement are added to the statement. The rest are removed when you close and reopen the statement.

8 Highlight the lines that are included on the vendor statement.

To help you identify the items you have displayed for possible inclusion, you can click the Display button to display other columns. (For example, you can display the PO number to identify which purchase order a line is attached to.)

9 Click Credit to display the Credit PO Line window:

10 Complete the fields on the window:

Field

Action

Quantity

Enter the quantity to credit (as shown on the vendor statement). (The quantity that has been invoiced appears by default.)

Cancel Items box

Mark the box if you want to cancel the order for these items.

Amount

Enter the line amount shown on the vendor statement for the title. (Enter the total line amount, not the unit price. You can enter the amount as a positive or negative number; however, Horizon will automatically change it to a negative number since you are recording a credit.)

Statement Line

Enter the line number on the vendor statement that corresponds to the title.

Internal Note

If you want, enter an internal note about the credit memo. (These notes are appended to the notes in the Internal Note field on the PO line and are recorded in the PO Line Item History window. They are not printed on any correspondence you send to the vendor.)

11 Click OK.

If you highlighted multiple lines, the next title appears in the Credit PO Line window, along with the notes you entered for the last title.

12 If another title appears, repeat steps 10–11. (If you want to apply the credit to another invoice at this point, see Applying Credits.)

 


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