Question

Goods returned to suppliers should be accompanied by __________.

• A. Bill
• B. Cash Memo
• C. Debit note
• D. Credit note

Answer 1

The correct option is C Debit note

A Debit note is a document evidencing a debit to be raised against a party for reasons other than the sale on credit. On finding that goods supplied are not as per the terms of the order placed, the defective goods are returned to the supplier of the goods and a note is prepared to debit the supplier; or when an additional sum is recoverable from a customer such a note is prepared to debit the customer with the additional dues.

In these two situations the note raised is called as a debit note.