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Purchases Return (Journal) Book

In this book, purchases returns of goods are recorded. Sometimes goods purchased are returned to the supplier for various reasons such as the goods are not of the required quality, or are defective, etc. For every return, a debit note (in duplicate) is prepared and the original one is sent to the supplier for making necessary entries in his book. The supplier may also prepare a note, which is called the credit note. The source document for recording entries in the purchases return journal is generally a debit note. A debit note will contain the name of the party (to whom the goods have been returned) details of the goods returned and the reason for returning the goods. Each debit note is serially numbered and dated.

The format of the purchases return journal is shown in figure 4.7(a).

Purchases Return (Journal) Book

Date

Debit

note No.

Name of supplier

(Account to be Debited)

L.F.

Amount

Rs.

 

 

 

 

 

Fig 4.7(a): Format of Purchases return (journal)book

Debit and Credit Notes

A Debit note is a document supporting a debit to be raised against a party for reasons other than sale on credit. On finding that goods supplied are not as per the terms of the order placed, the defective goods are returned to the supplier of the goods and a note is prepared to debit the supplier; or when an additional sum is recoverable from a customer such a note is prepared to debit the customer with the additional dues.

In these two situations the note is called a debit note (refer figure 4.7(b)).

                        Name of the Firm Issuing the Note

                                                                     Address of the Firm

No.                                                               Date of Issue .........

                                            DEBIT NOTE

Against : Supplier's Name

Goods returned as per delivery                                    Amount (Rs)

Challan No.

(Details of goods returned)

(Rupees ...........only)

                                            Signature of the Manager with date

Fig. 4.7(b): Showing a specimen of debit note
 
A Credit note is prepared, when a party is to be given a credit for reasons other than credit purchase. It is a common practice to make it in red ink. When goods are received back from a customer, a credit note should be sent to him.

The proforma of credit note is shown in figure 4.7(c).

 

Name of the Firm Issuing the Note

                                                                      Address of the Firm

No.                                                               Date of Issue .........

                                                CREDIT NOTE

Against : Supplier's Name

Goods returned as per delivery                                     Amount (Rs)

Challan No.

(Details of goods returned)

(Rupees ...........only)

                                                Signature of the Manager with date

Fig. 4.7(c): Showing a specimen credit note

 

Refer to the purchases (journal) book of Kanika Traders you will notice that 20 mini size T.V.'s and 15 tape- recorders were bought from Neema Electronics for Rs. 1,82,000 However, on delivery 2 mini T.V.'s and tape recorders were found defective and were returned back vide debit note no. 03/2005.

In this case, the purchases return books will be prepared as follows:
Purchases Return (Journal) Book

Date

Debit

note No.

Name of supplier

(Account to be Debited)

L.F.

Amount

Rs.

 

03/2005

Neema Electronics

 

13,200

______

13,200

______

Posting from the purchases returns journal requires that the supplier's individual accounts are debited with the amount of returns and the purchases returns account is credited with the periodical total.

Neema Electronics Account
Dr. Cr.

Date

Particulars

J.F.

Amount

Rs.

Date

Particulars

J.F.

Amount

Rs.

 

Purchases Return

 

13,200

       
Purchases Return Account
Dr. Cr.

Date

Particulars

J.F.

Amount

Rs.

Date

Particulars

J.F.

Amount

Rs.

         

Sundries as per purchase return book

 

13,200





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