Question

Long Answer Questions.
Write the circumstances for which Debit Notes and Credit Notes are issued.

Answer 1

Under the following circumstances Debit Notes and Credit Notes are prepared and issued:
(i) When the damaged or defective goods are returned by the buyer to the seller.
(ii) When the goods are rejected by the buyer as they are not as per the sample description is given, or delayed.
(iii) If there is a difference between the quantity mentioned in the bill and the quantity actually delivered.
(iv) If there is a difference between the price quoted in the quotation and the actual price charged in the bill.
(v) If mistakes are committed in calculations.
(vi) If there is a difference in the amount or rate of tax (e.g. service tax) charged.
(vii) If there is a difference in the other charges, such as packing, forwarding, loading, unloading, transportation etc.
(viii) If an adjustment in the discount granted is carried out wrongly.
(ix) If a cheque is issued by the buyer is dishonoured.
(x) If an adjustment in the rate or amount of commission is done.
(xi) If interest is charged by seller on overdue payments from the buyer.