Purchases Returns Book

Definition and Explanation:

Purchases returns book is a book in which the goods returned to suppliers are recorded. It is also called returns outward book or purchases returns day book. Goods may be returned because they are of the wrong kind or not up to sample or because they are damaged etc. The ruling of this book is absolutely the same as of purchases day book. The book and entries are made therein just the same as those made in the purchases day book.

Posting:

The total of the purchases returns or returns outwards book is credited to returns outward account or purchases return account (being the goods sent out). Individual suppliers to whom goods are returned are debited (because they receive the goods).

Debit Note:

When the goods are returned to the suppliers, an intimation is sent to them through what is known as a debit note. These debit notes serve as vouchers for these entries. A debit note is a statement sent by a businessman to another person, showing the amount debited to the account of the later. Debit notes are usually serially numbered and are prepared in the same form as that of the invoice.

Form of the Debit Note:

Debit Note

Messrs Rehman & Sons Standard Road Multan	Lahore, March 19, 1991.
To goods returned: 10 shirts at $12 10 pairs trousers at $20 Goods returned as per R/R No.........dated.......	120 200
	320
E & O. E	For Good Luck & Co. Partner

Format of Purchases Returns Book:

The following is the format of purchases Returns book:

Date	Particulars	D/N	L.F.	Amount

Example:

From the following transactions of a trader prepare the purchases returns day book and post it into ledger:-

1991		$
January 8	Karim & Sons	135
" 20	Fazal Din & Co.	150
" 31	Saeed Bros.	250

Solution:

Purchases Day Book

Date	Particulars	D/N	L.F.	Amount
1991 Jan. 8 " 20 " 31	Karim & Sons Fazal Din & Co. Saeed Bros.			$ 135 150 250
				535

Purchases Returns Account

1991 Jan. 31

By Purchases as per P.R.B.

$ 535

Karim & Sons

1991 Jan. 8

To Purchases returns

135

Fazal Din & Co.

1991 Jan. 20

To Purchases Returns

$ 150

Saeed Bros.

1991 Jan. 31

To Purchases

$ 250