GOROKA TECHNICAL COLLEGE

Computerised Accounting Systems

LESSON EIGHTEEN

LESSON OUTCOMES
At the end of this lesson the student will:
1. Recording sales returns and credits
2. Pending sales and backorders
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Recording sales returns and credits

Credit notes are treated by MYOB as negative invoices. A credit note might represent the
physical return of some paint by a customer. It might be a credit for a ladder damaged in
transit that is retained by the customer but the customer is compensated for part of its value.
Likewise, the business will receive a credit note from its suppliers when it returns items or
receives a credit.

Service business can also give credits. For example, George from Pro Paint has rung Henry to
tell him that the paint they had tinted does not quite match the sample they supplied.
Mortified, Henry offers to take K20 off the bill and George accepts this offer. Follow the
steps below to record this credit note.

Follow these steps:

1) Click the Sales commend centre icon.
2) Click the Enter Sales button and select the Service type invoice from layout
icon.
3) Select Pro Paint as the customer and click the Date field.
4) Key 15/4/98 and change the invoice number to CN1
5) Click the description column.
6) Key Credit for mismatched tinting and press TAB.
7) Select the Temp Work income account 4.1700 from the account list by
clicking the scroll down arrow.
8) Key -20 (minus 20) as the amount and press enter. Compare your solution
with figure 5.23.
9) Click Cancel to return to the commend centre.
10) From the commend centre icon in the menu bar, select Sales.
11) Click Settle Returns & credits from the list. See figure 5.24.

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Fig: 5.23 Sales Returns to Pro Paint

12) Highlight the credit transaction and click Apply to sale. The Settle Returns &
credits dialog will appear. You will apply the K20 credit to the Pro Paint
invoice no. 6. This means that the amount left owing on the invoice will be
reduced by K20.

Fig: 5.24 Sales returns & credits list window

13) Key 15/4/98 date and click the amount applied column for the Pro Paint
invoice. The amount will appear, if not select invoice number 6 and key in the
amount. See figure 5.25.
14) Click Record.

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 Fig: 5.25 Applying the Sales Return to the Invoice

Activity 5.8
Raise a credit note for one can of ceiling paint (K35 per can) returned from Pro Paint on 19th
April. Change the invoice number to CN2. Enter the amount as a negative amount in the ship
column and apply the invoice against sales invoice number 4.

Pending sales and backorders

Sydney Paint Shop has called Henry to say that the ceiling he supplied has been a huge
success and they urgently need thirty more cans. Complete the sales invoice as shown in
figure 5.26 but do not record it.

Fig: 5.26 Partially completed Sydney Paint Shop invoice

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We know Henry does not have the thirty cans of ceiling paint in stock and so does MYOB.
You could make the whole sale pending by selecting pending instead of record. However,
because Henry can fulfil part of the sale, he will deliver seventeen cans and backorder the
reminder.

Follow these steps:

1) Click Record.
Because the shipped quantity of the thirty is more than the seventeen cans
MYOB recorded in inventory, the backorder list dialog box will appear. See
figure 5.27.
2) Click the Backorder button.
3) Click Record and MYOB will record an invoice for the shipped quantity and
automatically create a pending invoice for the backordered quantity. See
figure 5.28.

Fig: 5.27 Backorder list Window

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 Fig: 5.28 Backorder invoice completed

Activity 5.9
a) Generate a new pending purchase order (#8) to No Flake for fifty cans of
ceiling paint on 24th April 1998.
b) Record the delivery of the fifty cans of ceiling paint on 29th April 1998.
c) For 29th April 1998 record the pending sale to Sydney Paint Shop in the same
manner as you would record a pending purchase.

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Reference:
Keeping Account with MYOB by Cathy Grundy & Doug Lyte.