Credit note,Debit note and difference between billing and invoice

[mvr_police]

Hi to all

Can anybody explian me about the difference between billing and invoice, and also about credit note and debit note, credit memo request and credit memo, as i am working in these areas, so if possible do let me know the configuration part these areas

thanks to you all

[mvr_police]

Thank u all

[Former Member]

Hi Mani,

=>Billing vs invoice

Both are the same. Normally in industies, we call the billing documents as Invoice ...

Billing is Generic term for invoices, credit memos, debit memos, proforma invoices and cancellation documents.

=>credit note vs debit note,

Credit/debit note/credit for returns- these all are billing documents as i said earlier.

Credit note- will be issued to the customer ,if the company charges more than actual.simply company has to pay to the customer-

eg: Goods might be damanged in transporation,which cant be taken back into plant,but customer already charged for these goods. Sometimes company will deliver the same amount of goods to customer or sometimes issues the credit note for the damaged goods.

debit note:- whle doing transaction in system,user mistakenly entered less value and there is no min/max value check & its paid by the customer.Client take the notice to the customer & issues debit note,vch means-customer has to pay the balance amount to the company.

Credit for returns:-

damaged goods,rejected goods will be placed an order by the customer to take those goods back in plant.

then the goods will be coming within company,nothing company receive goods frm customer & for these goods which already settles the amount will be issued a credit note for these returned goods.

=>credit note and credit memo request & Debit note and debit memo request

creating sales order to issue the credit note is -Credit memo request & doc cat -K

simillarly for debit note -- debit memo req & doc cat - L

credit/debit note is billing doc - G2/L2, check in VOFA transaction

Credit /debit note req - VOV8 trans

As said by Amit, pls always have a search ..

Regards,

Vvieks

[Former Member]

Hi Mani,

The credit memo request is one type of the sales document which can be created with reference to a sales order/billing document.All these will be maintained in VOV8 T.Code.If you have to pay to customer in that case we are going to create a credit memo request.Because of the damaged goods returning etc. there r cases where we have to pay to customer.

The debit memo request is one type of the sales document which can be created with reference to a sales order/billing document.All these will be maintained in VOV8 T.Code.If you have to receive from customer in that case we are going to create a debit memo request.

Comin to billing and invoice:

Both are same in SD point of view.

- In SD terminology we call as Billing Document and

- In FI terminology we call as INVOICE.

- In MM again only INVOICE will be there for Vendors.

Invoice is document indicating to delivery goods and Billing is a receipt of payment.

If we receive the goods from vendors that is called bill if we give the goods to customer that is called invoice.

Bill means we have to pay the amount against bill invoice means we have to receive the amount against invoice.

Invoice is for both : Vendor Invoice and Customer Invoice.

Billing Tcodes:

- VF01 create billing document. The delivery order comes up auto.

- VF02 the billing doc comes up auto . View the accounting enteries

Invoice Tcodes:

- FB60 Create invoice with respect to rawmaterial and tax.

- FB70 Invoice entries with respect to sales and tax

Coming to credit memo and debit memo:

With reference to above created creditmemo request we will create a credit memo

With reference to above created debitmemo request we will create a debit memo.

Regards,

MohanPhani

[Former Member]

Hi there,

These are the basics of SD that one needs to know as an SD consultant. You should be thorught on these basics before getting into the job. Anyway here is your answer.

Invoice is the billing doc which is created after the PGI is done. This is for the customer for the goods he has bought. For eg a customer has bought 100 quantity if material X each costig Rs 10. So billing is done in which an invoice of Rs 1000 is sent to the customer.

Billing is the process which is done against the goods sold. Invoices F1, F2, F5, F8, G2, D2 are all various billing documents.

For eg a customer has bought 100 quantity of material X each worth Rs 100. So he pays Rs 1000 towards the goods. After receiving the goods, he found that 10 out them are faulty. So instead of returning the 10 items, he would raise a credit memo request CR to get back the amount Rs 100 he paid for them. CR is an order type like OR or RE. CR will have billing type G2 credit memo though which the company returns Rs 100 back to the customer.

In the above case consider that we have underchangered the customer. The original cost of goods is Rs 10 buit we have just chanred Rs 9 to the customer & he pays Rs 900 towards the 100 items he took from us. In that case to reciver the correct amount we will need to get an extra Rs 100 from the customer. So we raise a debit memo L2 by which the customer pays the company extra Rs 100.

We also have an invoice correcttion request RK which we raise to correct the price difference 9over charge or under charge)

Regards,

Sivanand

[mvr_police]

Thank u vishnu

As you said, ur wright and i am currently working, we are expecting a project which is a textile industry, i have gone through their functional scope document and i had certain doubts relating to the same, i have knowledge but i never worked in this part, i knidly request u to let me know the configuration part, and how to configure, i understood the conept of the terminology and also crediit and debit,and do let me know the logic to apply the scenarios which are required by the client, (if there is any),

I do know the difference between billing and invoice, i heard billing is umbrella(Collective) and invoice is nothing but which we done individual, plz correct me if i am wrong

Regards

Mani

[Former Member]

Dear Mani,

In your last post, you haven't mentioned your doubts, from the functional scope document of the client.

If, this is related to configuration of Credit Memo and Debit Memo; I don't think, there is much difference (or any difference, as far as configuration or requirement is concerned, irrespective of the Industry).

A beautiful definition is already given by SAP, itself.

Debit Memo- A transaction that increases Amount Receivable from a customer is Debit memo.If the prices calculated for the customer were too low, for example, calculated with the wrong scaled prices, you can create a debit memo.

Credit Memo - A transaction that reduces Amounts Receivable from a customer is a credit memo. For eg. The customer could return damaged goods. A debit memo is a transaction that reduces Amounts Payable to a vendor because, you send damaged goods back to your vendor.

Also, a descriptive procedure is available in thread:

[Credit/ Debit Memo|]

Best Regards,

Amit

Note: Things to remember:

1. Document Type configuration

T. Code: VOV8

Credit Memo Request doc. type: CR

Debit Memo Request doc. type: DR

T. Code: VOFA

Credit Memo Doc. type: G2

Debit Memo Doc. type: L2

2. To Create Credit/ Debit Memo

T. Code: VF01

3. To Create Credit/ Debit Memo Request

T. Code: VA01

4. Copy-Control Settings:

T. Code: VTFF (Bill-to-Bill) - If, with reference to Invoice

T. Code: VTAF (Bill-to-Order) - If, with reference to Credit/ Debit Memo Request/ Returns

[Former Member]

Dear Mani,

[Search Forum|https://www.sdn.sap.com/irj/scn/forumsearch]

Or,

[SAP Help|http://help.sap.com]

Best Regards,

Amit

Note: Alternatively, refer thread:

[Credit/ Debit|;