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WAEC Financial Accounting 1999 Question 35

Question 35

Double Entry and the Ledger

Which of the following entries is made when damaged goods are returned to the supplier?

  1. A.Supplier's Account is debited and the Purchaser's Account credited
  2. B.Returns Outwards Account is debited and the Supplier's Account credited
  3. C.Purchaser's Account is debited and the Supplier's Account credited
  4. D.Supplier's Account is debited and the Returns Outwards Account credited.
Show the answer and explanation

Answer: D (Supplier's Account is debited and the Returns Outwards Account credited.)

Explanation

Returning goods reduces what we owe (debit supplier) and is recorded as returns outwards (credit).