Question

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QUESTION BELOW

Q. WHY RETURN INWARD IS NOT SUBSTRACTED FROM CASH REVENUE FROM OPERATIONS..

ANSWER PLEASE ...​

Answer 1

Answer:

hii mate........

Some companies do not use the contra-account for the purpose of sales return. Instead, they debit the sales account directly and credit accounts receivable or cash. When a product is physically returned, it increases inventory and decreases related cost of goods sold recognized at the time of sale.

Returns inwards are goods returned to the selling entity by the customer, such as for warranty claims or outright returns of goods for a credit. For the customer, this results in the following accounting transaction: A debit (reduction) of accounts payable. A credit (reduction) of purchased inventory.

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Answer 2

Explanation:

Returns inwards and returns outwards

A debit (reduction) in revenue in the amount credited back to the customer. ...

A credit (reduction) of the accounts receivable account, either against an unpaid customer invoice or as an open credit that the customer can apply to future invoices.