What is debit note and credit note, why it is issued?

Question

Accepted Answer

Debit note and credit note are financial documents used to record adjustments in accounts payable and accounts receivable.

Debit note is issued when a buyer returns goods to a seller or when there is an overcharge in the invoice amount.
Credit note is issued when a seller returns goods to a buyer or when there is an undercharge in the invoice amount.
Debit note increases the buyer's accounts payable and decreases the seller's accounts receivable.
Credit note decreases the buyer's accounts payable and increases the seller's accounts receivable.
Both notes are used to correct errors in invoices, adjust for damaged goods, or resolve disputes over pricing or quantity.

Top Infosys BPM Assistant Accountant Executive interview questions & answers