Goods purchased are returned for various reasons, mostly for quality fail/ defective piece. Purchase Return Transaction can be entered with Ref. to any Confirmed GRN.
Purchase Return can of three types:
Actions Involved in Purchase Return are:
When Purchase return is approved, the TRADE CREDITORS – control A/C's sub account's (Supplier) credit available will be added the returned amount.
When Purchase Return is posted to GL, the following accounting entries should be created.
GL Interface Type/[Account] | Account Usage | Sub-account | Currency | Dr | Cr | Notes |
---|---|---|---|---|---|---|
Inventory/Accruals | Ledger | Base | Standard Cost | |||
TRADE CREDITORS/Accounts Payable | AP | Supplier | Prime | (Purchase Price-Discount) + Tax | ||
Accrued Purchases-Agents | Ledger | Prime | (PurchasePrice-Discount)*Commission%/100 | |||
Accrued Purchases-Sundries | Ledger | Base | AdditionalCost | |||
Purchase Commission | Ledger | Prime | (Purchase Price-Discount)*Commission%/100 | |||
Purchase Discount | Ledger | Prime | Discount | |||
GST-Input TAX | Tax | Prime | (PurchasePrice-Discount)*TaxRate/100 | Incase of Import Taxes/Duties Payable Contra Should be Used | ||
Purchase Variance | Ledger | Base | (Purchase Price*Exchange Rate)+Additional Cost-Standard Cost |
When Purchase Return (Discount) is posted to GL, the following accounting entries should be created.
GL Interface Type/[Account] | Account Usage | Sub-account | Currency | Dr | Cr | Notes |
---|---|---|---|---|---|---|
TRADE CREDITORS/Accounts Payable | AP | Supplier | Prime | (Purchase Price-Discount) + Tax | ||
Purchase Discount | Ledger | Base | Discount |
For Exchange type returns, There should be NO monetary transactions. But for better clarity A voucher is created like Return on Issue DN. That Voucher is reversed when exchanged goods arrives by clicking Receive Confirm