How to Record Purchase Returns in Accounting and Inventory

To record a purchase return, identify the original purchase invoice, select the returned items and quantities, and create a return document linked to that invoice. Update inventory quantities and values, then reduce the supplier payable or recognize a refund receivable if the invoice was already paid.

Under a perpetual inventory system, returning goods purchased on credit generally reduces accounts payable and inventory, with applicable input tax adjustments according to local regulations. Try Cash Cloud for free to explore purchasing, returns, inventory, and accounting tools.