How does Reject Qty on the Receipt work?

Hi,

I see that we can enter a rejected qty on the receiver and select the Reject action as  'Return for Credit'. How does this work, does it create a debit memo? Can any one throw some light on this??

For example, I received a quantity of 10 and rejected 2 so the accepted qty is 8, but the invoice comes in for a qty of 10, what happens when we try to match it.

Thanks