What is Credit note?

A document that reduces or cancels the amount on an issued invoice.

Definition

A credit note is issued when an invoice needs to be reduced, for example after a refund or an error. It references the original invoice, rather than altering it, to keep records intact.

Example

An invoice of 5,000 was issued with a duplicate line of 1,000. A credit note of 1,000 corrects it.

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