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    richard63636 Posts: 2, Reputation: 1
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    #1

    Jan 5, 2016, 08:41 PM
    Journalise replacement of faulty goods to customer, and return to supplier
    Hi.

    I purchase goods from a supplier. I then sold some of the goods to a customer. The customer sent some back because they were damaged. I replaced them. Later I tried to return them to the supplier, but they didn't accept responsibility. How do I journalise this?
    richard63636's Avatar
    richard63636 Posts: 2, Reputation: 1
    New Member
    		  
    #2

    Jan 5, 2016, 08:53 PM
    Should I debit (increase) Cost of goods sold, and credit (reduce) inventory in the first case? (as essentially the Sale hasn't changed at all... just the extra inventory).

    Or should I include the Sales Returns and Allowances account somewhere? (though this doesn't make sense, as the sale is still in effect.

    Then when I attempt to return to the purchaser, because he doesn't accept responsibility, I can't reduce inventory (if I've already done that)... would there possibly be a separate "damaged goods" account, that I'd need to debit in the first part, to record the returned goods? (but then what would I offset that with?).

    It's confusing me no end.

    Thanks in advance
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