What is Return Inwards?

Return Inwards

Return inwards refer to the goods returned to an organization by its customers. They are goods which were sold, but usually, because of being unsatisfactory, were returned back by the customers. They are also called the Sales returns.

Returns in accounting refer to the goods returned by a business to its suppliers or by a customer to a business. In one case, it is a sales return and on the other, it is a purchase return. The transaction in both cases is reversed and the concerned sale or purchase couldn’t happen.

Sales return reduce total sales of a company and the deduction is shown in the trading account. A subsidiary book called Sales returns book is made to record all such entries.

Journal Entry for Return Inwards

Return Inwards A/C Debit
To Customer’s A/C Credit


Return Inwards or Sales Returns

Related Topic – What is Purchase Returns Book?

Example – Return Inwards

Let’s suppose, a customer Star Pvt Ltd returned goods worth 5,000 to Unreal Corp. The journal entry to record these sales returns in the books of Unreal Corp. will be as follows

Return Inwards A/C 5,000
To Star Pvt Ltd. A/C 5,000


>Read Return Outwards