Sales Return

In day-to-day business you might come across many scenarios where customers return or deny the goods and services that your organization has offered. SAP Business One’s sales module is equipped to handle sales returns and credit memos. In this blog we will see the various forms that support sales returns and the scenarios where those forms come in to use.

 

·       Return: - For legal reasons, you cannot delete a delivery or invoice that you enter in SAP Business One or change accounting-relevant data in these documents. However, the customer might send the goods back for various reasons, or you might have made a mistake when you entered the documents. In such situations, create a return document. When you enter a return document, you can reverse the posting of a delivery. When you create the return, the system corrects the inventory quantities. If your company runs a perpetual inventory, creating a return automatically generates a journal entry that updates the inventory value. The return is the clearing document for a delivery. Therefore, if an A/R invoice has not yet been created for the delivery you want to reverse, use the return document.

 

·       A/R Credit Memo: - The credit memo is the clearing document for the invoice and for the returns. If the goods were delivered to the customer and an invoice has already been created, you can partially or completely reverse the transaction by creating a credit memo. With the credit memo you correct both the quantities and the monetary values. The system increases the inventory of the credited items by the amount specified in the credit memo. The credit memo credits the value in the customer account in the accounting system and amends the revenue account by the same amount. The system corrects the tax amounts automatically.

 

When you create a return document based on a sales order, you can choose to reopen the item quantity of the order. Reopening the item quantity has the following consequences:

1.      The status of the sales order changes to Open.

2.      The delivered quantity is decreased by the quantity in the return.

3.      For service type transactions, the open amount is increased accordingly by a value equal to the value from a return line. If the sum of the remaining open amount plus the returned amount is greater than the total amount for the original order line, the total amount is used as the open amount.

4.      If there are any freight charges related to the returned item, these charges are reopened in the same way as the item quantities.

5.      If the item is managed by batches, the returned batch-allocated quantity is increased by the quantity from the return line.