Which item is normally recorded in the purchases returns book?
Correct answer: B. Goods returned to a supplier
- A. Goods returned by a customer
- B. Goods returned to a supplier
- C. Cash received from a customer
- D. Discount allowed to a customer
Explanation
The purchases returns book records goods sent back to suppliers after credit purchases. Goods returned by customers are recorded in the sales returns book, which is a separate book of prime entry.
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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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