CA Foundation · Accounting · Accounting Process
Which of the following transactions would be recorded in the Purchases Returns Book (Returns Outward Book) of a trader?
Goods returned by the trader to a supplier from whom they were bought on credit are recorded in the Purchases Returns Book. Customer returns go to the Sales Returns Book, furniture is not trading goods, and cash transactions are recorded in the Cash Book.
- AGoods returned by a customer, Mr. Iyer, to the trader
- BGoods returned by the trader to a supplier, Kapoor Traders, to whom the goods were bought on creditCorrect
- COld furniture returned to the supplier after purchase on credit
- DGoods purchased for cash returned to the supplier against refund in cash
Explanation
The Purchases Returns Book records only credit purchases of goods that are returned to suppliers; the supplier is debited through it. Goods returned by a customer go to the Sales Returns Book. Furniture is not goods traded in, and cash-purchase returns are recorded in the Cash Book.
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