Hope this might be helpful:
To clear out a partially used vendor credit in Business Central without creating a "fake" invoice, you have a few standard options, depending on how you want to account for the remaining balance:
Vendor Refund (Recommended):
- If the vendor is actually sending you the remaining money, this is the most accurate method.
- Create a Payment Journal line.
- Enter the vendor number.
- In the "Document Type" field, select "Payment."
- In the "Applies-to Doc. Type" and "Applies-to Doc. No." fields, apply this payment to the original credit memo.
- Enter the remaining balance of the credit as a negative amount in the "Amount" field (representing money received from the vendor).
- Specify the relevant Bank Account where the refund is received.
- Post the journal. This will clear the credit memo and increase your bank balance.
Write-Off to a G/L Account (Bad Debt/Miscellaneous Income):
- If you're not receiving money back and simply need to close out the credit (e.g., it's a small, uncollectible balance), you can write it off to a specific G/L account.
- Create a General Journal line.
- Line 1:
- "Account Type": Vendor
- "Account No.": The Vendor No.
- "Document Type": Payment (or "Journal" if preferred for write-off)
- "Amount": The remaining credit amount (as a negative value, to reduce the vendor's credit balance).
- "Applies-to Doc. Type" and "Applies-to Doc. No.": Apply this to the original credit memo.
- Line 2:
- "Account Type": G/L Account
- "Account No.": A suitable G/L account for writing off vendor credits (e.g., "Miscellaneous Income," "Other Revenue," or a specific "Vendor Write-Off" expense account, depending on your accounting policy).
- "Amount": The same remaining credit amount (as a positive value, to offset Line 1).
- Post the journal. This closes the credit memo and impacts the specified income/expense account.
Do NOT create a "fake" invoice. These two methods are standard and maintain a clear audit trail of why the credit was cleared.
✅ Mark this answer as verified if it helps you.
