The total of the purchases returns book is normally posted to which account?
Correct answer: C. Purchases returns account
- A. Purchases account
- B. Suppliers account
- C. Purchases returns account
- D. Sales returns account
Explanation
The purchases returns book records goods returned to suppliers, so its total is credited to the purchases returns account. Individual supplier accounts are debited because the amount owed to them decreases.
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About Double Entry and Books of Prime Entry
Double entry records every transaction with equal debit and credit entries, based on the accounting equation and the classification of assets, liabilities, capital, income and expenses. Books of prime entry include the sales, purchases, returns and cash books, journal, and source documents used before transactions are posted to ledger accounts.
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