Change in Agreed Purchase Consideration

Adjustment for change in agreed purchase consideration is accounted if there is a decrease/increase in the purchase price agreed upon.

●      Decrease in purchase consideration is accounted using debit note.

●      Increase in purchase consideration is accounted in credit note.

To create an entry for increase in agreed purchase consideration

1.     Go to Gateway of Tally > Accounting Vouchers > Crl+F8: Credit Note.

2.     Press Ctrl+V to change to voucher mode.

3.     Enter the original purchase invoice number and date in the Original Invoice No. and Original Invoice Dt. fields.

4.     Credit the party ledger from the original purchase invoice and enter the amount in the Credit column.

o      Select the bill towards which the consideration is changed in Bill-wise Details screen.

o      Press Enter to return to voucher screen.

5.     Debit the purchase ledger from the List of Ledger Accounts.

o      Select the item purchased on which the price has changed and enter the amount of changed consideration in Inventory Allocation screen.

o      Press Enter.

6.     Debit the VAT ledger and enter the VAT charged on the changed agreed consideration in the Debit column.

The credit note voucher appears as shown below:

7.     Press Enter to accept and save.

Decrease in agreed consideration

To create an entry for decrease in agreed purchase consideration

1.     Go to Gateway of Tally > Accounting Vouchers > Crl+F9: Debit Note.

2.     Enter the original purchase invoice number and date in the Original Invoice No. and Original Invoice Dt. fields.

3.     Select the Party’s A/c Name from the List of Ledger Accounts.

4.     Select the common purchase ledger.

5.     Select the Name of Item on which the price has changed. Enter the Quantity and reduction in Rate. The amount is automatically displayed in the Amount field.

6.     Select the common VAT ledger. The tax amount VAT charged on the changed agreed consideration is displayed automatically.

7.     Enable Provide VAT Details? to display Statutory Details screen.

o      Select Change in Consideration in the Nature of Return field.

o      Press Enter.

8.     Press Enter to display the Bill-wise Details screen.

o      Select the bill towards which the consideration is changed in Bill-wise Details screen.

9.     Press Enter to return to invoice screen.

The debit note invoice appears as shown below:

10.  Press Enter to accept and save.