When a Customer Returns Merchandise Previously Purchased on Credit the Entry

question 80

Short Answer

When a customer returns merchandise previously purchased on credit the entry for the seller to record the return requires a debit to the ________________ account and a credit to the ________________ account.

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Definitions:

Work In Process Inventory

The inventory that includes items currently being manufactured but not yet completed or ready for sale.

Weighted-Average Method

An inventory cost calculation method that averages the cost of all similar items available, regardless of purchase date.

Equivalent Unit

A concept in cost accounting used to compute the cost of partially completed goods, translating them into a number of fully completed units.

Assembly Department

A section of a manufacturing company where components are assembled into final products.