Purchases Returns Book


Purchases Returns Book:

Definition and Explanation:

Purchases returns book is a book in which the goods returned to suppliers are recorded. It is also called returns outward book or purchases returns day book. Goods may be returned because they are of the wrong kind or not up to sample or because they are damaged etc. The ruling of this book is absolutely the same as of purchases day book. The book and entries are made therein just the same as those made in the purchases day book.

Posting:

The total of the purchases returns or returns outwards book is credited to returns outward account or purchases return account (being the goods sent out). Individual suppliers to whom goods are returned are debited (because they receive the goods).

Debit Note:

When the goods are returned to the suppliers, an intimation is sent to them through what is known as a debit note. These debit notes serve as vouchers for these entries. A debit note is a statement sent by a businessman to another person, showing the amount debited to the account of the later. Debit notes are usually serially numbered and are prepared in the same form as that of the invoice.

Form of the Debit Note:

Debit Note

Messrs Rehman & Sons
Standard Road
Multan
Lahore,
March 19, 1991.
To goods returned:
10 shirts at $12
10 pairs trousers at $20
Goods returned as per R/R No………dated…….


120
200


320

E & O. E For Good Luck & Co.
Partner

Format of Purchases Returns Book:

The following is the format of purchases Returns book:

Date Particulars D/N L.F. Amount

Example:

From the following transactions of a trader prepare the purchases returns day book and post it into ledger:-

1991 $
January 8 Karim & Sons 135
”     20 Fazal Din & Co. 150
”     31 Saeed Bros. 250

Solution:

Purchases Day Book

Date Particulars D/N L.F. Amount

1991
Jan. 8
”   20
”   31


Karim & Sons
Fazal Din & Co.
Saeed Bros.
$
135
150
250
535

Purchases Returns Account


1991
Jan. 31


By Purchases as per P.R.B.

$
535

Karim & Sons

1991
Jan. 8


To Purchases returns


135


Fazal Din & Co.

1991
Jan. 20


To Purchases Returns

$
150


Saeed Bros.

1991
Jan. 31


To Purchases

$
250


You may also be interested in other articles from “subdivision of journal” chapter:

  1. Definition and Explanation of Cash Book
  2. Single Column Cash Book
  3. Two Column Cash Book/Double Column Cash Book
  4. Three Column Cash Book
  5. Bank Reconciliation Statement
  6. Petty Cash Book
  7. Purchases Day Book
  8. Purchases Returns Book
  9. Sales Day Book
  10. Sales Returns Book
  11. Bills Receivable Book
  12. Bills Payable Book
  13. Journal Proper

Other Related Accounting Articles:

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