If merchandise sold on account is returned to the seller, the seller may inform the customer of the details by issuing a

A) sales invoice
B) purchase invoice
C) credit memo
D) debit memo

Question

If merchandise sold on account is returned to the seller, the seller may inform the customer of the details by issuing aA)  sales invoiceB)  purchase invoiceC)  credit memoD)  debit memo

Olivia Simpson · Accepted Answer

Final Answer : C, Explanation :  When merchandise sold on account is returned to the seller, the seller issues a credit memo to inform the customer of the details of the return. This document will decrease the customer's accounts payable balance and increase the seller's sales returns and allowances account. A sales invoice is used when merchandise is sold and a purchase invoice is received by the buyer from the seller for purchases made on account. A debit memo is usually used to inform a customer of an increase in their accounts payable balance.

If merchandise sold on account is returned to the seller, the seller may inform the customer of the details by issuing a

A) sales invoice
B) purchase invoice
C) credit memo
D) debit memo

Definitions

Learning Objectives

Learning Objectives

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