Is Issue Credit Note means reducing AR from customers?

Hi! I am totally newbie to ERPNext. I created a Sales Return in a Delivery Note with Issue Credit Note. I also created a Sales Invoice with Is Return (Credit Note). On both of them, after submission, the customer’s AR were reduced upon checking GL entries. Does this mean that Issue Credit Note means reducing customer’s AR? Does it not create a Credit Note which i can apply later against the customer’s AR?

Hi @jon632,

Difference between Credit Note Issued and Return:

  • Credit Note Issued : The Item is returned by the Customer and a Credit Note is created against this invoice.
  • Return : It is assigned to Credit Note created against the original Sales Invoice. Though you can also create a standalone Credit Note.

Maybe, its help you.

Thank You!

1 Like

Thanks for the info. But when you say create a Credit Note, does it mean a Credit Note document will be “created” in the system which upon the discretion of management, can be applied to a customer’s AR later? Or it simply means customer’s AR will be reduced automatically and instantenously by passing GL entries (Sales debit, Customer AR credit)?


Please check it.

Hope you understand.