This document contains a 25 question multiple choice test on accounting for returns of stock. It covers topics like identifying source documents for returns, journal entries to record various types of returns, calculating amounts, and updating accounts in subsidiary ledgers. The questions are designed to test understanding of concepts and procedures related to accounting for returns between businesses and their customers.

1. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 1
Chapter 15 Test – Accounting for Returns of Stock
Name ___________________________________________
Circle the correct response for each question:
1. (a) (b) (c) (d)
2. (a) (b) (c) (d)
3. (a) (b) (c) (d)
4. (a) (b) (c) (d)
5. (a) (b) (c) (d)
6. (a) (b) (c) (d)
7. (a) (b) (c) (d)
8. (a) (b) (c) (d)
9. (a) (b) (c) (d)
10. (a) (b) (c) (d)
11. (a) (b) (c) (d)
12. (a) (b) (c) (d)
13. (a) (b) (c) (d)
14. (a) (b) (c) (d)
15. (a) (b) (c) (d)
16. (a) (b) (c) (d)
17. (a) (b) (c) (d)
18. (a) (b) (c) (d)
19. (a) (b) (c) (d)
20. (a) (b) (c) (d)
21. (a) (b) (c) (d)
22. (a) (b) (c) (d)
23. (a) (b) (c) (d)
24. (a) (b) (c) (d)
25. (a) (b) (c) (d)
Total /25 marks

2. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 2
Chapter 15 Test – Accounting for Returns of Stock
1. The source document that provides evidence of a return of stock is a:
a) Receipt
b) Cheque butt
c) Invoice
d) Credit note
2. Returns of stock are recorded in the:
a) Credit Purchases Journal
b) Stock Returns Journal
c) General Journal
d) Sales Returns Journal
3. A purchase return is where:
a) A customer returns stock to the business
b) Stock is valued using FIFO
c) The business returns stock to its supplier
d) All of the above
4. A sales return is where:
a) The business returns stock to its supplier
b) The customer is granted a credit for the cost price of the stock purchased
c) Sales are made on credit
d) A customer returns stock to the business
5. When goods are returned by a customer, a debit is made to:
a) Sales Returns
b) Sales
c) GST Clearing
d) Both Sales Returns and GST Clearing
6. Purchase returns are valued at:
a) First in First Out (FIFO)
b) The value of the last stock purchased (LIFO)
c) The amount shown on the supplier’s credit note
d) The lowest cost of stock on hand (under the Conservatism principle)
7. Sales returns are valued at:
a) The value of the last stock purchased (LIFO)
b) The amount shown on the supplier’s credit note
c) First in First Out (FIFO)
d) The lowest cost of stock on hand (under the Conservatism principle)

3. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 3
The following document has been issued by a trading business which applies a 50% mark-up to all
stock sold.
Hermione’s Hats No. 72
340 Glenferrie Road
Hawthorn, VIC 3122 Date: 18 July
CREDIT: REASON: Damaged
The Hat Rack
265 Burke Road
Camberwell, VIC 3124
Description Qty Unit price Subtotal GST Total
Deluxe Fez Hat 12 $40.00 $480.00 $48.00 $528.00
Total $480.00 $48.00 $528.00
Total (excluding GST) $480.00
Total GST $48.00
Total credit approved (including GST) $528.00
8. The business receiving the credit in this document is:
a) Hermione’s Hats
b) Deluxe Fez Hat
c) No credit is being issued in this document
d) The Hat Rack
9. The effect on the accounting equation of The Hat Rack of this document will be:
a)
Item Increase/Decrease Amount
Assets Increase 480
Liabilities Increase 480
Owner’s Equity
b)
Item Increase/Decrease Amount
Assets Decrease 480
Liabilities Decrease 480
Owner’s Equity
c)
Item Increase/Decrease Amount
Assets Decrease 524
Liabilities Decrease 524
Owner’s Equity

4. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 4
d)
Item Increase/Decrease Amount
Assets Decrease 524
Liabilities Decrease 48
Owner’s Equity Decrease 480
10. The double-entry that would result from the issuing of this document in the general ledger of
Hermione’s Hats would be:
a)
DEBIT CREDIT
Account Amount Account Amount
Sales 480 Debtors Control 528
GST Clearing 48 Debtor-The Hat Rack 528
Stock Control 320 Cost of Sales 320
b)
DEBIT CREDIT
Account Amount Account Amount
Sales Returns 480 Debtors Control 528
GST Clearing 48 Debtor-The Hat Rack 528
Stock Control 320 Cost of Sales 320
c)
DEBIT CREDIT
Account Amount Account Amount
Sales Returns 480 Debtors Control 528
GST Clearing 48 Debtor-The Hat Rack 528
Stock Control 240 Cost of Sales 240
d)
DEBIT CREDIT
Account Amount Account Amount
Sales Returns 524 Debtors Control 528
Stock Control 240 Cost of Sales 240

5. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 5
The following transactions occurred between Max’s Music and Tony’s Wholesale Tunes.
1 Apr Max’s Music purchased stock from Tony’s Wholesale Tunes on credit
for the amount of $1,500 plus GST of $150
3 Apr Upon delivery, Max’s Music discovered that $200 (plus GST) of the
stock delivered by Tony’s Wholesale Tunes was damaged. This stock
would have been sold for $400 (plus GST). These units were
returned and Credit Note 15 was issued on 3 April.
11 Apr Max settled the firm’s account with Tony’s Wholesale Tunes with a
payment of $1,350.
11. The correct General Journal entry to record the return of goods by Max’s Music would be:
a)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
3 Apr Creditors Control 200
Creditor – Tony’s Wholesale Tunes 200
Stock Control 200
b)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
3 Apr Creditors Control 220
Creditor – Tony’s Wholesale Tunes 220
Stock Control 200
GST Clearing 20
c)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
3 Apr Stock Control 200
GST Clearing 20
Creditors Control 220
Creditor – Tony’s Wholesale Tunes 220
d)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
3 Apr Creditors Control 220
Creditor – Max’s Music 220
Stock Control 200
GST Clearing 20

6. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 6
12. The subsidiary ledger for Tony’s Wholesale Tunes would be:
a)
Creditor – Tony’s Wholesale Tunes
3 Apr Stock Control/GST Clearing 220 1 Apr Stock Control/GST Clearing 1,650
11 Apr Bank/Discount Revenue 1,430
1,650 1,650
b)
Creditor – Tony’s Wholesale Tunes
3 Apr Stock Control/GST Clearing 220 1 Apr Stock Control/GST Clearing 1,650
11 Apr Bank 1,430
1,650 1,650
c)
Creditor – Tony’s Wholesale Tunes
3 Apr Stock Control/GST Clearing 220 1 Apr Stock Control/GST Clearing 1,650
11 Apr Bank/Discount Revenue 1,430
d)
Creditor – Tony’s Wholesale Tunes
3 Apr Sales Returns/GST Clearing 220 1 Apr Stock Control/GST Clearing 1,650
11 Apr Bank/Discount Revenue 1,430
1,650 1,650

7. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 7
Justin’s Jumpers sold goods on credit to Connolly’s Clothing for $880 including GST on 4 August. On 5
August Connolly’s Clothing contacted Justin’s Jumpers to complain that $300 (plus GST) of the stock
delivered was the wrong colour. Justin’s Jumpers then issued Credit Note 48 to Connolly’s Clothing.
The cost price of the goods returned was $165 (including GST).
13. The General Journal entry to record Credit Note 48 in the records of Justin’s Jumpers is:
a)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
5 Aug Sales Returns 300
GST Clearing 30
Debtors Control 330
Debtor – Connolly’s Clothing 330
Stock Control 150
Cost of Sales 150
b)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
5 Aug Sales Returns 300
GST Clearing 30
Debtors Control 330
Debtor – Connolly’s Clothing 330
Stock Control 165
Cost of Sales 165
c)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
5 Aug Sales 300
GST Clearing 30
Debtors Control 330
Debtor – Connolly’s Clothing 330
Stock Control 150
Cost of Sales 150
d)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
5 Aug Creditors Control 165
Creditor – Connolly’s Clothing 165
Stock Control 150
GST Clearing 15

8. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 8
14. On balance-day on 31 August the account for Connolly’s Clothing in the Debtors Subsidiary
Ledger of Justin’s Jumpers would look like:
a)
Debtor – Connolly’s Clothing
4 Aug Sales/GST Clearing 880 5 Aug Sales Returns/GST Clearing 330
b)
Debtor – Connolly’s Clothing
4 Aug Sales/GST Clearing 880 5 Aug Sales Returns/GST Clearing 330
31 Aug Balance 550
880 880
1 Sep Balance 550
c)
Debtor – Connolly’s Clothing
4 Aug Sales/GST Clearing 968 5 Aug Sales Returns/GST Clearing 330
31 Aug Balance 638
968 968
1 Sep Balance 638
d)
Debtor – Connolly’s Clothing
4 Aug Sales/GST Clearing 880 5 Aug Sales Returns 330
31 Aug Balance 550
880 880
1 Sep Balance 550
The following details relate to transactions between Enrico’s Elegant Envelopes and one of its
customers, Kevin Kline.
3 May Credit sale of $3,900 plus GST of $390 (cost price $1,900)
6 May Kline returned stock and was issued a credit of $462 (selling price
$420, GST $42, cost $190)
11 May Kline received credit off his account for $1,328 made up of a cash
payment of $1,200 and a discount of $128 for early payment.
21 May Credit sale made for $1,650 (including GST) of stock originally
costing $810
31 May Legal advice has been received that Kevin Kline has been declared
bankrupt, with all creditors receiving 40 cents in the dollar (Memo
19)

9. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 9
15. The entry to record the transaction on 6 May in the General Journal would be:
a)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
6 May Sales 420
GST Clearing 42
Debtors Control 462
Debtor – Kevin Kline 462
Stock Control 190
Cost of Sales 190
b)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
6 May Sales Returns 420
GST Clearing 42
Debtors Control 462
Debtor – Kevin Kline 462
c)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
6 May Sales Returns 420
GST Clearing 42
Debtors Control 462
Debtor – Kevin Kline 462
Stock Control 190
Cost of Sales 190
d)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
6 May Sales Returns 420
GST Clearing 42
Debtors Control 462
Debtor – Kevin Kline 462
Cost of Sales 190
Stock Control 190

10. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 10
16. The entry to record the transaction on 31 May in the General Journal would be:
a)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
31 May Bad Debts 1,660
Debtors Control 1,660
Debtor – Kevin Kline 1,660
b)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
31 May Bad Debts 2,490
Bank 1,660
Debtors Control 4,150
Debtor – Kevin Kline 4,150
c)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
31 May Bad Debts 1,660
Bank 2,490
Debtors Control 4,150
Debtor – Kevin Kline 4,150
d)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
31 May Bad Debts 2,490
Debtors Control 2,490
Debtor – Kevin Kline 2,490

11. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 11
17. On 31 May the subsidiary for Kevin Kline will look like:
a)
Debtor – Kevin Kline
3 May Credit Sales/GST Clearing 4,290 6 May Sales Returns/GST Clearing 462
21 May Credit Sales/GST Clearing 1,650 11 May Bank/Discount Expense 1,328
31 May Bank 1,660
31 May Bad Debts 2,490
5,940 5,940
b)
Debtor – Kevin Kline
3 May Credit Sales/GST Clearing 4,290 6 May Sales Returns/GST Clearing 462
21 May Credit Sales/GST Clearing 1,650 11 May Bank/Discount Expense 1,328
31 May Bank 2,490
31 May Bad Debts 1,660
5,940 5,940
c)
Debtor – Kevin Kline
3 May Credit Sales/GST Clearing 4,290 6 May Sales/GST Clearing 462
21 May Credit Sales/GST Clearing 1,650 11 May Bank/Discount Expense 1,328
31 May Bank 1,660
31 May Bad Debts 2,490
5,940 5,940
d)
Debtor – Kevin Kline
3 May Credit Sales/GST Clearing 4,290 6 May Sales Returns/GST Clearing 462
21 May Credit Sales/GST Clearing 1,650 11 May Bank/Discount Expense 1,328
31 May Bank 1,660
31 May Bad Debts 2,490

12. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 12
During May a trading business had the following details:
 Balance of stock control as at 1 May: $25,600
 Credit purchases of stock: $14,000 (plus $1,400 GST)
 A physical stocktake on 31 May revealed a stock gain of $300
 Credit sales of $32,000 plus $3,200 GST (cost price $17,400)
 The owner withdrew stock for personal use for the amount of $800.
 Purchase returns granted by suppliers of $440 (excluding GST)
 Customers returned goods and received credits to the value of $990 inclusive of GST (cost
price $500).
18. Based on this information, the firm’s Stock Control ledger (before it is balanced) would look like:
a)
Stock Control
1 May Balance 25,600 31 May Cost of Sales 17,400
31 May Creditors Control 14,000 31 May Drawings 800
31 May Stock Gain 300 31 May Creditors Control 440
31 May Cost of Sales 500
b)
Stock Control
1 May Balance 25,600 31 May Cost of Sales 17,400
31 May Creditors Control 14,000 31 May Drawings 800
31 May Stock Gain 300 31 May Creditors Control 400
31 May Cost of Sales 500
c)
Stock Control
1 May Balance 25,600 31 May Cost of Sales 17,400
31 May Creditors Control 14,000 31 May Drawings 800
31 May Stock Gain 300 31 May Creditors Control 440
31 May Cost of Sales 900
d)
Stock Control
1 May Balance 25,600 31 May Creditors Control 14,000
31 May Cost of Sales 17,400 31 May Drawings 800
31 May Stock Gain 300 31 May Creditors Control 440
31 May Cost of Sales 500

13. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 13
19. The firm’s Cost of Sales ledger (before closing) will look like:
a)
Cost of Sales
31 May Stock Control 17,400 31 May Stock Control 440
b)
Cost of Sales
31 May Stock Control 17,400 31 May Stock Control 400
c)
Cost of Sales
31 May Stock Control 17,400 31 May Sales Returns 500
d)
Cost of Sales
31 May Stock Control 17,400 31 May Stock Control 500

14. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 14
A business had the following Stock Card:
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
1 Nov Balance 7 20 140
3 Nov Inv. 891 15 25 375 7 20 140
15 25 375
4 Nov Rec. 56 4 20 80 3 20 60
15 25 375
On 5 November the firm discovered that two of the units purchased on 3 November were faulty and
returned them to the supplier. The supplier provided a credit in full (Credit Note T32).
20. The Stock Card entry to correctly record the purchase return on 5 November is:
a)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
5 Nov Credit Note T32 2 25 50 3 20 60
13 25 325
b)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
5 Nov Credit Note T32 2 20 40 1 20 20
15 25 375
c)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
5 Nov Credit Note T32 1 20 20 2 20 40
1 25 25 14 25 350
d)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
5 Nov Credit Note T32 2 25 50 3 20 60
17 25 425

15. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 15
A business had the following Stock Card:
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
1 Jan Balance 4 15 60
12 18 216
5 Sep Inv. 103 4 15 60
1 18 18 11 18 198
On 9 September the customer who purchased the five units on 5 September, Christina Castle,
returned one unit that was the wrong size. A credit was issued for $40 plus GST of $4 (Credit Note:
1A).
21. The General Journal entry to record the return on 9 September will be:
a)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
9 Sep Sales Returns 40
GST Clearing 4
Debtors Control 44
Debtor – Christina Castle 44
Stock Control 15
Cost of Sales 15
b)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
9 Sep Sales Returns 40
GST Clearing 4
Debtors Control 44
Debtor – Christina Castle 44
Stock Control 18
Cost of Sales 18
c)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
9 Sep Creditors Control 44
Creditor – Christina Castle 44
Stock Control 40
GST Clearing 4

16. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 16
d)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
9 Sep Sales 40
GST Clearing 4
Debtors Control 44
Debtor – Christina Castle 44
Stock Control 18
Cost of Sales 18
A business had the following Stock Card:
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
1 Dec Balance 3 40 120
10 45 450
7 Dec Inv. 99 3 40 120
2 45 90 8 45 360
The sale on 7 September was made on credit to Bobby Beckett. On 8 September Beckett returned
three of the units purchased due to them being damaged during delivery. The firm issued a full
credit for $330 (including GST) on Credit Note 0178.
22. The Stock Card entry to correctly record the sales return on 8 September is:
a)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
8 Sep Credit Note 0178 1 40 40 10 45 450
2 45 90 1 40 40
b)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
8 Sep Credit Note 0178 2 40 80 2 40 80
1 45 45 9 45 405
c)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
8 Sep Credit Note 0178 3 45 11 45 495

17. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 17
d)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
8 Sep Credit Note 0178 1 40 40 1 40 40
2 45 90 10 45 450
On 1 May a business provided the following information in relation to one of its stock items:
Balance as at 1 May 9 @ $15
20 @ $13
Credit sale on 3 May to N. Nice (Inv. 57) 12 units @ $30 plus GST
Sales return on 6 May from N. Nice (Credit NN1) 4 units: credit allowed $120 plus GST
23. The General Journal entry to correctly record the return on 6 May is:
a)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
6 May Sales Returns 120
GST Clearing 12
Debtors Control 132
Debtor – N. Nice 132
Stock Control 52
Cost of Sales 52
b)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
6 May Sales Returns 120
GST Clearing 12
Debtors Control 132
Debtor – N. Nice 132
Cost of Sales 54
Stock Control 54

18. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 18
c)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
6 May Sales Returns 120
GST Clearing 12
Debtors Control 132
Debtor – N. Nice 132
Stock Control 54
Cost of Sales 54
d)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
6 May Sales Returns 120
GST Clearing 12
Debtors Control 132
Debtor – N. Nice 132
Stock Control 60
Cost of Sales 60
A business had the following Stock Card:
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
1 Mar Balance 4 20 80
3 Mar Inv. Y390 16 30 480 4 20 80
16 30 480
4 Mar Inv. 200 4 20 80
2 30 60 14 30 420
On 5 March the firm returned three units from the stock purchased on Invoice Y390 and was granted
a credit in full from the supplier, Crafty Cutlery, on Credit Note 44.
24. The General Journal entry to correctly record the return on 5 March is:
a)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
4 Mar Creditors Control 66
Creditor – Crafty Cutlery 66
Stock Control 60
GST Clearing 6

19. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 19
b)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
4 Mar Creditors Control 88
Creditor – Crafty Cutlery 88
Stock Control 80
GST Clearing 8
c)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
4 Mar Creditors Control 99
Creditor – Crafty Cutlery 99
Stock Control 90
GST Clearing 9
d)
General Journal
Date Particulars General Ledger Subsidiary Ledger
Debit $ Credit $ Debit $ Credit $
4 Mar Creditors Control 77
Creditor – Crafty Cutlery 77
Stock Control 70
GST Clearing 7

20. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 20
A business had the following Stock Card:
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
1 Dec Balance 20 80 1600
9 Dec Inv. A20 40 90 3600 20 80 1600
40 90 3600
14 Dec Inv. H45 20 80 1600
2 90 180 38 90 3420
The following additional transactions took place during December:
 16 December – 1 unit sold to J. Jones on 14 December was returned due to damage (Credit
Note 3). This unit was sold for $130 (plus $13 GST).
 19 December – the business returned the damaged unit to its supplier, Brie’s Bags (Credit
Note No. C35). It was purchased on 9 December.
 31 December – A physical stocktake shows 41 units on hand (Memo No. 78).
25. The Stock Card entries to correctly record the additional transactions are:
a)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
16 Dec Credit Note 3 1 80 80 1 80 80
38 90 3420
19 Dec Credit Note C35 1 80 80 38 90 3420
31 Dec Memo 78 3 90 270 41 90 3690
b)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
16 Dec Credit Note 3 1 90 90 39 90 3510
19 Dec Credit Note C35 1 90 90 38 90 3420
31 Dec Memo 78 3 80 240 3 80 240
38 90 3420
c)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
16 Dec Credit Note 3 1 90 90 39 90 3510
19 Dec Credit Note C35 1 90 90 38 90 3420
31 Dec Memo 78 3 90 270 41 90 3690

21. VCE ACCOUNTING
UNIT 4 – CONTROL AND ANALYSIS OF BUSINESS PERFORMANCE
CHAPTER 15 – ACCOUNTING FOR RETURNS OF STOCK
© Michael Allison.
Author’s permission required for external use
Page | 21
d)
IN OUT BALANCE
Date Reference Qty Cost Value Qty Cost Value Qty Cost Value
16 Dec Credit Note 3 1 90 90 39 90 3510
19 Dec Credit Note C35 1 90 90 38 90 3420
31 Dec Memo 78 1 80 80 1 80 80
2 90 180 40 90 3600