Accounting Entries: Sales, Returns, and Adjustments
1. Credit Sale with Discount and Returnable Packaging
- A sale of goods on credit for 1,500 euros was made. The invoice includes a discount of 150 euros. The goods are contained in returnable packaging, which is billed at 200 euros.
1,798.00 | 430 | Customers [(1,350 + 200) * 1.16] | to to to | Sales of Merchandise (1,500 – 150) Packaging and Containers to be Returned by Customers Output VAT [(1,350 + 200) * 0.16] | 700 437 477 | 1,350.00 200.00 248.00 |
2. Fire Loss of Returnable Packaging
- A fire in the warehouse destroyed returnable packaging from suppliers, amounting to 110 euros.
110.00 | 602 | Purchase of Other Supplies | to | Packaging and Containers to be Returned to Suppliers | 406 | 110.00 |
3. Bill of Exchange Discounted and Paid
- A bill of exchange, with a face value of 400 euros, was discounted at the bank and subsequently paid by the drawee.
400.00 | 5208 | Debts for Discounted Instruments | to | Trade Bills Discounted | 4311 | 400.00 |
4. Customer Returns and Packaging Sales
- A customer returned packaging amounting to 240 euros. The same customer decided to keep other packaging worth 80 euros.
240.00 38.40 | 437 477 | Packaging and Containers to be Returned by Customers Output VAT (240 * 0.16) | to | Customers (240 * 1.16) | 430 | 278.40 |
80.00 | 437 | Packaging and Containers to be Returned by Customers | to | Sales of Packaging | 704 | 80.00 |
5. Doubtful Debt Settlement and Bad Debt Write-Off
- A customer, previously classified as doubtful, settled their debt of 400 euros. Another customer’s debt of 120 euros was deemed a definitive bad debt.
400.00 120.00 | 570 650 | Cash Losses from Uncollectible Trade Receivables | to | Customers with Doubtful Debts | 436 | 520.00 |
520.00 | 490 | Impairment of Trade Receivables | to | Reversal of Impairment of Trade Receivables | 794 | 520.00 |
6. Sales Return Due to Quality Issues
- The customer from transaction 1 complained about the quality of the goods. The error was acknowledged, and a discount of 100 euros was granted. The refund will be issued via check in January.
100.00 16.00 | 708 477 | Returns of Sales and Similar Operations Output VAT | to | Customers | 430 | 116.00 |