Hello!! is return inward debit or credit?
Answers
Return Inward is basically sales return. Since sales have a credit balance, sales return would have a debit balance. Similarly, purchases have debit balance and purchase return(return outward) have credit balance.
Answer: In accounting, a return inward is usually recorded as a debit in the books of accounts.
This means that the amount of the returned goods or services are added back to the inventory or sales account, and the customer's account is credited.
The reason for this is that the return of goods or services indicates that the company has received back what it had previously sold, and thus the inventory or sales account needs to be increased to reflect this increase in the company's assets. At the same time, the customer's account needs to be credited because they have returned the goods or services, and thus the amount they owe to the company is reduced.
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