Accounting entries in the Return Inward book are recorded on the basis of a debit note.

True

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False

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Solution

The correct option is B False
Accounting entries in a return inward book are recorded on the basis of a credit note. A credit note is a letter sent by the supplier to the customer notifying the customer that he or she has been credited a certain amount due to an error in the original invoice or other reasons.

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Similar questions

Rectify the following errors assuming that suspense account was opened. Ascertain the difference in trial balance.

(a) Credit sales to Mohan Rs. 7000 were recorded in purchase book. However, Mohan's account was correctly debited.

(b) Credit purchase from Rohan Rs. 9000 were recorded in the sales book. However, Rohan's account was correctly credited.

(c) Goods returned to Rakesh Rs. 4000 were recorded in sales return book. However, Rakesh's account was correctly debited.

(d) Goods returned from Mahesh Rs. 1000 were recorded through purchase return book. However, Mahesh's account was correctly credited.

(e) Goods returned to Naresh Rs. 2000 were recorded through purchase book. However, Naresh's account was correctly debited.

Rectify the following errors assuming that suspense account was opened.

Ascertain the difference in trial balance.

(a)	Credit sales to Mohan Rs 7,000 were recorded in Purchase Book. However, Mohan’s account was correctly debited.
(b)	Credit purchases from Rohan Rs 9,000 were recorded in sales book. However, Rohan’s account was correctly credited.
(c)	Goods returned to Rakesh Rs 4,000 were recorded in sales return book. However, Rakesh’s account was correctly debited.
(d)	Goods returned from Mahesh Rs 1,000 were recorded through purchases return book. However, Mahesh’s account was correctly credited.
(e)	Goods returned to Naresh Rs 2,000 were recorded through purchases book. However, Naresh’s account was correctly debited.

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