Adjustment to invoice - credit note required?

Accounting
1

Included in my July19 sales was an amount for an invoice to one of my clients. Hypothetically, let’s say the total amount payable is £500. My client has made a few part payments and, again, imagine this has brought the balance owing to £200. A slight dispute has ensued over the invoice and I have agreed to knock an amount off this remaining £200 to mean the client now only owes £175.00.

Question; in the books do I a) go back to the original invoice for £500 and add an ‘adjustment line’ to show -£25, or b) raise a credit note against the invoice for this £25?

2

I would raise a credit note.

It is always best to avoid changing invoices if there is an alternative.

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