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Hi. How do we account for a credit note, received from a supplier, in the payables ledger control account? Is it a debit or a credit to the control account?
I figure it should be a credit, because of the journal entry Dr Cash Cr Payables. But I also figure it might be a debit, because of the journal entry Dr Payables Cr Purchases.
Please respond. Thanks.
A credit note is like a negative invoice – it means that we owe less to the supplier.
We therefore debit the payables account to reduce the amount owing.
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