Debit Memo System

There are situations where you have merchandise to return to a vendor. The Debit Memo System was created for you to remove merchandise from your inventory and post a Credit Memo to your Vendors account. The Debit Memo System can be found within the Purchase Order System located in the menu on the left. Enter & Edit Debit Memo’s is also located on the Tool Bar under Documents.

The Debit Memo System consists of three main screens; Heading Screen, Detail Lines, and the Final screen. Once in Enter & Edit Debit Memo System not all fields on the heading screen are mandatory: Some fields are used for formatting the heading on the Debit Memo document. Others may only apply in certain instances, such as In-Bound or Out-Bound Freight, if you are receiving credit for freight enter the amount you will be credited and this will be added to the Debit Memo total due to you from the Vendor. On the next page you can see the Heading screen fields which are summarized below.

The Debit Memo Number – This is automatically generated by pressing Enter.
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Date – This defaults to Today’s date but a different date can be entered.
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Vendor – Enter a few letters of the Vendor Name you are entering the Debit Memo for.
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Document Type – this can be PO, Processing PO or Other. If you chose PO or Processing PO you must then choose a valid document number in the next field – Related to. If the Debit Memo is for product that was received before using The Business Edge you would not have a valid document number, so the Document Type would then be Other.
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Related To – This is the original PO or PPO Number if the Product is from a document received in the system. You can also press spacebar and enter or click on the lookup box to see all documents received from the chosen vendor.
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Packing List Number and Original Vendor Invoice number and Original Invoice Date are optional.

​Vendor RMA Number – this will be used as the Vendor Credit Invoice Number when the Debit Memo is updated, it will also include DM- Debit Memo Number. If you do not enter an RMA Number the Vendor Credit will just be the DM-Debit Memo Number.
The rest of the fields are optional and can be filled in and printed as needed.

The next screen is the Detail Lines where you will enter the products you are returning to your vendor. When you go into a New Line you can click on Select Line on the right and the system will show you all of the Products on the document selected, this is a quick easy way to pick the correct product.

It is important to be sure and put in the correct cost that you will be credited for. If there is a restocking charge you will want to reduce the cost on the Detail Screen to reflect the cost you will be credited. If there is a discrepancy between the cost you will be receiving credit for and you on hand inventory you are sending back the system will put the difference in your Inventory Adjustment account.

Below you can see the Product to be returned, the system will prompt you to Allocate the lot that is being returned to the Vendor:

To enter additional products to be returned simply press enter, or click on New Line.

Below you will see the Final Screen. The options on the right side give you the choice to go back and edit fields within any of those screens. You should always check the Debit Memo Totals on this screen. It is extremely important to be sure that the Total on the Debit Memo matches exactly the amount you will be credited. When you update the Debit Memo this is the amount that will post to Accounts Payable. Debit Memo’s cannot be reversed. You have other options where you can change the address, add a Final Message that will print on the bottom of the Debit Memo, Output the Debit Memo or attach a scanned document. If you are e-mailing the Debit Memo the default e-mail address for Debit Memo’s in the Vendor Master file will fill in automatically.

Most companies will wait until they receive the actual Credit from the Vendor before updating the Debit Memo, you will have your own internal procedures relating to this. Once you update the Debit Memo you cannot change it. The inventory that was allocated to the Debit Memo will show as committed until the Debit Memo is updated.

When you are ready to update the Debit Memo you can choose Update Debit Memo from the Debit Memo Menu located below.

Enter the Debit Memo Number all other detailed information will auto populate. You can change the Dates and or the Balancing GL Account on this screen, see the example below. The Update Date will be the date that the Credit Posts to the General Ledger, the Original Vendor Invoice Date will be the Date of the Credit. The Balancing GL Account is where any difference in price will be posted. Press Esc or click OK to continue the update.