Journal Entry for Purchase Return

Journal Entry for Purchase Return

In this article we would discuss the journal entry for purchase return. There are two methods for recording the purchase return.In first method the purchase return is credited to purchase account by debiting the relevant account (who returned the purchases). It is a kind of reversal entry for purchase.

Date	Particular	Ledger Folio	Dr.	Cr.
01-01-2017	Cash/Bank		xxx
01-01-2017	Purchase			xxx

In second method the purchase return is charged to a separate account i.e. purchase return account. The purchase return account is credit and related account is debited. This method is more suitable for controlling the purchase return.

Date	Particular	Ledger Folio	Dr.	Cr.
01-01-2017	Cash/Bank		xxx
01-01-2017	Purchase Return			xxx

 

Journal Entry for Cash Purchase Return

Journal entry for cash purchase return may be recorded by debiting the cash and crediting the purchase return.

Date	Particular	Ledger Folio	Dr.	Cr.
01-01-2017	Cash		xxx
01-01-2017	Purchase Return			xxx

Journal Entry for Credit Purchase Return

Journal entry for credit purchase return may be recorded by crediting the purchase return account and debiting the creditor to whom goods are returned. A sample entry is shown

Date	Particular	Ledger Folio	Dr.	Cr.
01-03-2015	Creditor’ account		xxx
01-03-2015	Purchase Return			xxx