Purchase Return
Accounting glossary · Understand, connect, apply
A purchase return occurs when a buyer sends purchased goods back to a supplier and receives a refund or a reduction in the amount payable.
Example
A retailer returns goods costing $100 and receives a $100 supplier credit.
Remember the difference
From the supplier’s viewpoint this is a sales return. Entries depend on the inventory system and the condition of returned goods.
Examples are simplified for learning. Where a term depends on US law, IFRS, US GAAP or a historical rule, check the context explained above and the requirements relevant to your course.
Study references: OpenStax financial accounting and managerial accounting. For reporting requirements, consult the applicable IFRS Standards or FASB guidance. US tax terms should be checked against the relevant tax-year IRS instructions.
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