Question

A return inwards book is kept to record ______________.

• A. returns of goods sold
• B. returns of anything purchased
• C. returns of goods purchased
• D. returns of anything sold.

Answer 1

The correct option is A returns of goods sold

When goods are received back from customer which are sold on credit, a note is prepared and the original copy of the same is sent to the party that returned the goods, i.e. the customer. This note is termed as credit note because the customer from whom the goods are received back, his/her account is credited with the amount written in the note and on the basis of duplicate copy of credit note the transaction is recorded in the sales return books by the supplier.