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Answer / h.r. sreepada bhagi
Purchase Return - Goods purchased earlier returned to the
Supplier. Supplier needs to return the value of the goods
returned or supply some other goods or replacement for the
goods received to settle the account of the purchaser
Sales Return - Goods sold earlier returned by the customer
(buyer). Seller needs to refund the money to the customer or
supply some other products or replace the returned products
with new ones to settle the account of the buyer(Business
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Answer / pravin ninawe
Goods/Stock purchased or sold being returned is quite a common practice in business.
This may be on account of a number of reasons like defects in goods, quality not matching the requirement for which the buyer purchased it, the buyer not needing the stock, etc.
This happens both in case of goods purchased as well as goods sold by the organisation.
Where the goods sold are being returned we call it "Sales Returns" and where goods purchased are being returned we call it "Purchase Returns"
The transactions of return of goods are also accounting transactions and have to be recorded in the books of accounts just like any other accounting transaction.
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