Question

Calculate Net purchases from the following:
Purchases (Gross) 30,50,000, Return outward 50,000​

Answer 1

ANSWER :

• ❖ If the value of Purchases (Gross) is Rs. 30,50,000 and Return Outward is Rs. 50,000; then Net Purchases will be Rs. 30,00,000.

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SOLUTION :

❒ Given :-

• Purchases (Gross) = Rs. 30,50,000

• Return Outward = Rs. 50,000

❒ To Calculate :-

• Net Purchases = ?

❒ Required Formula :-

• $\dag \: \: \underline{ \boxed{ \sf{ \: Net \: \: Purchases = Gross \: \: Purchases - Return \: \: Outward \: }}}$

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❒ Calculation :-

We have,

• Gross Purchases = Rs. 30,50,000

• Return Outward = Rs. 50,000

Substituting the values in the formula, we get,

• Net Purchases = Gross Purchases - Return Outward

➨ Net Purchases = Rs. 30,50,000 - Rs. 50,000

∴ Net Purchases = Rs. 30,00,000

• Hence, the value of Net Purchases is Rs. 30,00,000.

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KNOW MORE :

❍ Purchase :↦

• ✎ In accounting, the term "Purchase" refers to the buying of goods which are meant for resale. Purchase may be in cash or on credit. Purchase of goods made by paying cash is known as Cash Purchase and purchase of goods made in which payment is to be done in futute is known as Credit Purchase.

• ✎ Total Purchase (Gross) = Cash Purchase + Credit Purchase

❍ Return Outward :↦

• ✎ Return Outward is also known as Purchase Return. When the whole or a part of the bought goods is returned to the seller, it is known as Purchase Return or Return Outward.

❍ Net Purchase :↦

• ✎ In accounting, the term "Net Purchase" means the amount of purchase left after deducting Purchase Return from the Total Purchase. It is the net value of the purchase of goods made.

• ✎ Net Purchase = Total Purchase (Gross) - Purchase Return