What type of account is sales return?

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Solution

Sales return is considered a contra revenue account as it has an opposite effect on the net income. In other words, it reduces the net income.

Also read:

Cash Book

Purchase Book

Sales Book and Sales Return Book

Cash Flow Statement

Ledger in Accounting

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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 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.

From the following Subsidiary Books prepare necessary ledger accounts and balance them.

2018
July 1	Sohan & Sons returned 2 Laptops HP sold @ ₹ 40,000 each plus CGST and SGST @ 6% each
July 2	Ramesh & Sons, Noida returned 2 'Ricoh' printers sold @ ₹ 10,000 each plus IGST @ 12%
July 25	Dinesh, Chandigarh returned 10 HP Desktops sold @ ₹ 20,000 each plus IGST @ 12% for delayed supply
July 26	Computer Mouse returned by Ravi, Delhi sold to him for cash ₹ 2,000 plus CGST and SGST @ 6% each

What type of accounts are purchase and sales account ? Real or nominal ?

Error of undercasting sales return book is rectified by _____ the sales returns account.

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